Over the last 18 months, ACE Northern Ireland has been working in partnership with local government’s Central Procurement Directorate (CPD) to agree a new methodology where the lowest price is no longer the determining factor in the award of a contract.
Working alongside other professional bodies in the Construction Professionals’ Council NI, ACE Northern Ireland has effectively made the case that a new approach to public procurement is required. This is vital to the local economy – in Northern Ireland some 40% of construction output is publicly funded.
The fundamental shift agreed is that the best price will no longer be the lowest, but one that is closest to an average. The average that will be used is a “narrow average” where the lowest and highest prices are excluded.
The discussions have now led to CPD beginning a pilot scheme. This means that all construction services contracts, both above and below the EU threshold, will now be awarded in one of the following ways:
- Projects with no quality assessment at tender stage will be awarded on the basis of the Mean Narrow Average calculation;
- Projects with a quality and price assessment at tender stage will base the price score on the Mean Narrow Average calculation; or
- Projects with a fixed fee tender will be awarded on the assessment of quality only.
Full details of the “mean narrow average” calculations are available to ACE members below. All members interested in bidding for CPD projects are strongly advised to review this and ensure they fully understand its implications.
This work forms part of a wider piece of work on procurement in Northern Ireland, but this announcement represents a good first step. We hope to report on new developments in the near future.