Procurement policy

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31 March 2022
Policy

Procurement policy

Procurement policy

Policy Statement

Westminster Foundation for Democracy (“WFD”) is committed to ensuring that, in relation to its procurement activities, WFD:

  • Has a transparent and accountable process
  • Funds are used effectively to deliver maximum benefit
  • Minimises the risk of fraudulent activities and accidental errors
  • Is compliant with donor requirements, minimising the risk of ineligible spend

This policy applies to all procurement activities relating to:

  • Goods – tangible products or items, such as stationary or furniture
  • Works – such as repairs to property
  • Services – support or activities provided by another organisation, such as conference/ meeting facilities, audit or legal work, or professional consultancy to support WFD
  • Experts – professional consultancy to support programme activities  

WFD may, from time to time, determine that in order to secure a procurement arrangement for specified goods and/or services that offers flexibility to WFD staff and demonstrates good value for money, it will put in place a Framework Agreement. This Procurement Policy will apply to the process to select and contract the supplier(s) under such a Framework Agreement. Once in place, the suppliers under the Framework Agreement may be directly contracted to deliver relevant goods and/or services without any further procurement process. In the context of experts, a framework arrangement in the form of an Associate Agreement may be put in place with individuals wishes to appoint as an Associate.

Policy Principles

WFD’s Procurement Policy is based on several principles. All WFD procurement activities must be:

  • Fair – treating all suppliers and potential suppliers equally throughout all procurement activities.
  • Transparent to all parties involved.  All steps in the procurement process must be documented appropriately to provide a clear audit trail, evidencing decisions made.
  • Compliant with requirements of donors as well as any relevant legislation.  Correct process must be followed, and appropriate authorisation given.
  • Ethical - Procurement activity must not support organisations involved in criminal activity such as fraud, corruption, forced labour (modern slavery) and other human rights abuses. Due diligence should be carried out on potential suppliers and business relationships responsibly managed with appropriate action being taken where unethical practices come to light.
  • Value for Money - This is not to be confused with the cheapest option. Value for Money can be defined using 3 E’s: Economy – best value; Efficiency – maximising outputs; and Effectiveness – outputs deliver the desired outcome(s).

Policy Implementation Framework

  1. Governance accountability

The Board of Governors of WFD, and the Chief Executive as Accounting Officer, are ultimately accountable for overseeing the enforcement of this Policy and ensuring the proper management of WFD’s arrangements to manage procurement activities. The Board may delegate responsibility to the Audit & Risk Committee from time to time.

  1. Management responsibility

The Director of Operations of WFD holds overall management responsibility for developing and implementing this Policy.

As a core organisational policy, each of the Finance, Operations, and People & Culture Teams has a role in supporting the implementation of the Policy. All three teams will promote good practice in procurement. In particular:

  • The Finance Team will advise on interpretation of this procurement policy as part of new starter induction, budgeting, and will support procurement planning by Programme teams; 
  • The Operations Team will provide technical advice on procurement processes and contracting and regular training; and
  • The People & Culture Team will provide support on sourcing experts.
  1. Scope and application

This Policy applies globally to all individuals procuring on WFD’s behalf.  This includes contractors, agency workers, and other individuals temporarily undertaking work for WFD under a contract of service.  It also applies to implementing partners.

The Policy covers any procurement by WFD for the supply of goods and services around the world, including consultants and experts. It does not apply to any grants or sub-grants made by WFD to partners. 

  1. Stakeholder roles and responsibilities

Internal stakeholders must:

  • read and comply with this Policy. Failure to comply with this Policy will be treated as a serious matter and may result in disciplinary measures being taken;
  • undertake any mandatory training as may be required under this Policy;
  • act ethically, impartially and objectively in all their purchasing activities; and,
  • ensure any additional requirements per the donor’s contract terms are met when conducting work on a third-party contract. 

Stakeholders must not:

  • be involved in selecting suppliers or overseeing procurement if there is a real or perceived conflict of interest. This includes situations where the employee, any member of the employee’s immediate family, or employee’s partner has a financial or other interest in the organisation selected.
  1. Procurement thresholds (excluding Expert Roster)

The standard process to purchase goods or to commission works or services from suppliers or consultants (except for the expert consultants who are registered on the Expert Roster):

Estimated value

Procurement method

Up to £100

Petty cash (cash & receipt process)

 

£101- £3,000

Single quote process – written

 

£3,001 - £15,000

Formal three quote process – minimum of 3 written quotations requested based on a written specification of requirements

£15,001 and above

Formal tender process open to a minimum of 3 bidders, which should be advertised via Contracts Finder

 

£138,000 and above

Formal tender process in accordance with public procurement law and good practice, which should be advertised via Find a Tender. Please inform the Director of Operations


 

The total value of the purchase (inclusive of VAT), including possible contract extensions, must be taken into consideration when deciding which threshold applies.

Procurements must not be artificially split into separate orders to avoid the processes and signatories associated with a higher threshold.

If the final cost of the service/ goods procured is 50% or more higher than the quoted price, the reasons for this must be reviewed by the original committee plus a member of the Operations & People Services directorate.

Donor procurement thresholds, if lower, must be adhered to for all spend on a given grant or contract.wer, must be adhered to for all spend on a given grant or contract.

6. Three quote process

Formal (£3,001 to £15,000)

  1. A brief summary of the business case for the procurement should be set out in a  Procurement Comparison Form.
  2. Potential suppliers should be equally informed in writing (e.g. an email or by advertisement) of WFD’s requirements. A “Request for Quote” or “Call for Experts” template is available, which should include a written specification or terms of reference.
  3. Request a minimum of three written quotations from different suppliers or consultants, which should usually be in a proposal or quote document. The Request for Quotes or Call for Experts may be sent directly to relevant potential suppliers and/or advertised via WFD’s website/other platforms. All contacts with potential suppliers should be in writing (email) and include more than one WFD staff member.
  4. Suppliers should be given a minimum of 7 days to submit a quotation.
  5. Evaluate the quotations using the Comparison Form.  Evaluations must be conducted by a committee of at least 2, usually the staff member who has completed the procurement exercise and the budget holder (or their line manager if the budget holder is the one initiating the procurement).
  6. Select supplier based on this evaluation.  The justification for the selection must be clearly documented on the Comparison Form.
  7. Staff only need to make reasonable efforts to secure three quotes. ‘Reasonable efforts’ could mean advertising/re-advertising the opportunity, extending the deadline, or follow-up to solicit a response from suppliers. If only one or two suppliers respond you can proceed if you are able to conclude that they will deliver the service/ goods required effectively and offer good value for money. This should be recorded on the comparison form. If you do not feel you can reach this decision, you should send the request for proposals to additional suppliers.

7. Tender process (£15,001 and above)

  1. Finalise a detailed specification or terms of reference of exactly what is needed including why (outputs and outcomes), when, where and (if appropriate) within what budget.
  2. Publish an ‘Invitation to Tender’ or ‘Call for Experts’ and advertise the tender opportunity (in appropriate newspapers, noticeboards, online, WFD website, etc) and on Contracts Finder.  In the UK, Government guidance on procurement applies:
  3. https://www.gov.uk/government/collections/procurement-policy-notes#2017. All contacts with potential suppliers should be in writing (email) and include more than one WFD staff member.
  4. Issue the Invitation to Tender or Call for Experts to potentially suitable suppliers or consultants (target minimum of 3). 
  5. If an Expression of Interest is required, suppliers should submit a written Expression of Interest by the given deadline. 
  6. Suppliers should be given a minimum of 14 days to return a completed tender, which should be documented in writing.  A minimum of 2 tenders must be received or the process may need to be restarted.
  7. Evaluate tenders received using the ITT Scoring Sheet.  Evaluations must be conducted by a committee of at least 3, usually the staff member who has initiated the tender, the budget holder (or their line manager if the budget holder is the one initiating the procurement) and an additional member included as required to enable an informed decision – for example, a colleague with knowledge / expertise relevant to the tender (for example, a Programmes specialist, Head of Practice, MEL Manager, member of Operations & People Services directorate).
  8. Scored presentations/ interviews may be used as part of the tender process.  All suppliers must be invited, and all evaluation committee members must be present.
  9. Negotiation may be carried out during the tender process.  Suppliers must be treated equally – if some suppliers are given the opportunity to amend their quality or price, all other suppliers must also be given this opportunity. Any agreement reached during negotiation must be documented in writing and signed by the supplier.
  10. Justification for the selected supplier must be clearly documented in a formal minute of the committee

For any procurement valued in excess of £138,000, the tender process above should be followed with the following additional steps:

  • The opportunity should be advertised on the UK Government’s Find a Tender portal
  • Once the decision is made to award the contract, a formal award notice and formal rejection notices should be sent to the bidders.
  • A stand-still period of 10 days should be allowed between the date of the award notice and entering into a contract with the successful supplier.

A tender process is not required for hotel or travel bookings of more than £15,001 if using WFD’s preferred suppliers, or for a supplier under a Framework Agreement.

  • For hotel bookings three or more quotes should be requested from Key Travel or WFD’s local preferred suppliers and the formal three informal quote process followed.
  • For travel bookings using Key Travel a range of suitable options should be obtained and travel policy complied with.

It is possible for WFD to reserve any procurement valued at between £15,001 to £138,000 to bids from UK-wide or Greater London suppliers only, or to bids from Small and Medium sized Enterprises (SMEs) or Voluntary,  Community and Social Enterprises (VCSEs). For further information see the HMG Procurement Policy Note (here). Any procurement valued at over £138,000 should also take account of social value as part of the evaluation and scoring – see this HMG Procurement Policy Note (here).

8. Exceptional circumstances

In certain exceptional circumstances it may not be possible to comply with WFD’s procurement requirements.

Single source procurement is one example. Single source procurement may be appropriate when:

  • there is either very limited or no competition;
  • the item or service is truly unique and available only from a single source that has the expertise to do the work or produce the product or with capacity to complete in the time and at the scale required;
  • for technical or artistic reasons or because the supplier owns exclusive intellectual property rights that WFD needs to use;
  • the donor has stipulated or authorised that a particular supplier should be used for the purchase;
  • a competitive process and reasonable efforts did not result in three quotes or the minimum number of tenders;
  • WFD requires legal advice or services;
  • WFD requires document certification or authentication services; and/or
  • WFD intends to contract the supplier via an HMG or WFD framework agreement.  

Single or sole source procurement is receiving increasing donor scrutiny as there is a perception that it is used inappropriately. Applying it without strong justification will damage WFD’s reputation and potentially result in the associated expenditure being disallowed by the donor. All single source procurement over £15,001 must be reported annually to the FCDO.

Unless one of the specific exceptions above applies, the previous use of a supplier, or knowing that a supplier has relevant knowledge/ experience does not qualify for single source procurement. The appropriate procurement process should still be followed, to benchmark the supplier against the market, and the comparison form completed and approved in line with policy.

A case of genuine urgency is another example where the normal competitive process cannot be followed. This would apply in circumstances where there are genuine reasons for extreme urgency; the events that led to the need for extreme urgency were unforeseeable; it is impossible to conduct a competitive process; and in cases where WFD has not caused or contributed to the need for extreme urgency. For example, a waiver may be sought in the event of a natural disaster, outbreak of disease, act of terrorism, or where immediate action is required to preserve the health, safety, and security of WFD staff or partners or to address a gap in existing provision at short notice.

The procurement comparison form should be completed for any exceptional procurement to document why this exception has been necessary. The form should be signed by the individual proposing the procurement, the budget holder (or their line manager if the budget holder is the one initiating the procurement), and a waiver secured in advance as follows:

Estimated value

Authoriser

Up to £15,000

Regional Director or Deputy Regional Director (for relevant region)

Director of Programmes (for policy and programme related procurement at UK centre) or Director of Operations (for other procurement at UK centre)

Over £15,001

Chief Executive

9. New suppliers, sanctions checking, and due diligence

In all cases where procurement processes result in WFD purchasing goods or services from a new supplier, a new supplier form must be filled out by the supplier and uploaded to Business Central as part of the process to set up a new vendor.    

Vetting check

All suppliers, partners, and consultants must have passed a vetting check, guidance on this can be found in this Good Practice Guide on Due Diligence & Vetting. For new suppliers, this check must be completed before a commitment to purchase has been made. Staff should send the New Supplier Form and (if appropriate) name of the supplier’s directors, in advance of contracting, by email the HR and Operations Assistant. No contract should be entered into unless the contract manager has received confirmation that the vetting check has been cleared.

Additional due diligence

If the intention is to procure goods or services of a value totalling £15,001 or more or critical office supplies, a Supplier Due Diligence Assessment must also be carried out on suppliers in advance of placing orders or entering contracts. There are separate due diligence processes for programme partners and experts (consultants). Guidance on this can be found in this Good Practice Guide on Due Diligence & Vetting.

For third-party funded sub-contracting/granting, staff should consult the Partnering Policy in the first instance and complete the Partner Due Diligence Assessment.

The Director of Operations, or their designate, will review and confirm clearance for all additional due diligence processes. In high value or risk cases, the Finance Team will also be asked to undertake a financial review.

10. Contracts

WFD must not pay any party, or allow any party to start work for us, until we have an appropriate, written contract in place, which has been reviewed, authorised, and signed in accordance with this Policy.

Any change, extension or renewal to an existing contract must be reviewed and approved in accordance with this Policy, as if it were a new contract.

The authority to approve and sign a contract will depend on the level of expenditure:

Estimated value

Requirements

Up to £250

N/A

Between £251 and £15,000

Contract signed by the relevant SRO (Programme) or budget holder (UK centre function) and by supplier.

If this is not possible reasons must be clearly documented and the relevant Regional Director / Director of Operations must approve an alternate signatory.

If the relevant SRO is based in an unregistered country, the responsible Regional Director or their designate should sign the contract.

Over £15,001

A contract must be signed by the Chief Executive or Director of Operations and the supplier

WFD standard contract templates should be used wherever possible for any contract for services or consultancy agreement, including experts on the Expert Roster. If a supplier prefers to use their own contract template, this should be reviewed and approved by the Director of Operations prior to signature. If any changes are requested to the WFD standard contract by a supplier, the changes should be reviewed and approved by the Director of Operations prior to signature.

Framework Agreements may be used for routine or regular supplies of goods or services of a particular kind, including experts on the Expert Roster. The process to initiate a framework agreement will be overseen by the Operations Team. All teams are encouraged to make recommendations as to opportunities for a framework agreement with a particular supplier.

Timing(s) of payment should be stated in the contract. Ideally payment should only be made following the receipt of goods or services.

Payment should only be made in advance on an exceptional basis. Where payment is to be made to a supplier in advance, appropriate financial checks must be made on the supplier (see Due Diligence section).  This should only be undertaken by prior approval from Finance, to be secured via the Finance Business Partner.

11. Contractors (consultants or experts)

A contractor is a person who performs a service or undertakes a job for WFD but is not a member of WFD’s staff. Contractors can be short-term or long-term and can sometimes be known as consultants.  They may be used to support WFD business functions or for delivery of programme products or activities (often referred to as “experts”).

This section of the procurement policy relates only to short-term consultants. 

For the purposes of this policy, short-term will generally be services for up to four weeks at one time, on a one-off or ad hoc basis.

For guidance on recruitment of long-term consultants or temporary/ agency staff, please contact WFD’s HR team.

Short term business consultants who deliver services to support WFD’s business functions

For procurement of consultancy services to support WFD internal functions (for example, an IT specialist to deliver a system upgrade, translation, or local transport services), this procurement policy applies in the ordinary course – i.e. the appropriate procurement process in section 5 above will be followed in each case, depending on the expected value of the contract.

For short-term consultants supporting WFD’s business functions, the following maximum rate should be adhered to:

  • Daily rate: up to £250

In addition:

  • Travel costs can be covered by WFD.  Costs must be compliant with WFD’s Travel policy

Short-term expert consultants who deliver WFD programme activities or products

One of WFD’s unique selling points is its access to high quality experts.

WFD operates an “Expert Roster” of relevant consultants who have registered to offer their expertise to WFD, from time to time, to support programme delivery. Each expert listed on the roster has completed an application process and been subject to a due diligence process, verified their experience and expertise, and agreed to a daily rate.

The special process for commissioning experts from the Expert Roster is:

Estimated value of assignment

Procurement method

Up to £3,000

Request confirmation of availability and interest from one relevant expert on the Expert Roster via email, based on a terms of reference

£3,001 - £15,000

Request confirmation of availability and interest from three relevant experts on the Expert Roster via email, based on a terms of reference

£15,001 and above

Call for Experts (Invitation to Tender) published (via Contracts Finder) and sent, via email, to all relevant experts on the Expert Roster.

A waiver to exempt the procurement process above, in exceptional circumstances, is available in accordance with section 8 above. The commissioning staff member should record a file note explaining any decision to commission an expert from the Expert Roster if (a) there could be a perceived conflict of interest in relation to the selected expert, or (b) a fee is proposed that is higher than the agreed daily rate listed on the Expert Roster.

To commission services from any short-term expert consultant not on the Expert Roster, sections 5-8 of this procurement policy apply in the ordinary course – i.e. the appropriate procurement process in section 5 above will be followed in each case, depending on the expected value of the contract.

This policy is effective from April 2019 and replaces all other WFD procurement policies.
The policy was revised and reissued on 31 March 2022.