What is Commissioning
Commissioning is the 'how' - where public sector bodies decide what services they require to meet their priorities. The Audit Commission defines commissioning as "the process of specifying, securing and monitoring services to meet people's needs at a strategic level" [Social Services Inspectorate / Audit Commission (2003) Making Ends Meet], thereby emphasising the importance of commissioning as being needs led.
Commissioning involves:
- Assessment (or reassessment) of need
- Identification of resources
- Planning how to use the resources
- Arranging service delivery through a procurement process
- Monitoring and reviewing service delivery
The following LVSC diagram is a good example of a Commissioning Cycle depicting this process:
What is Procurement
Procurement is the 'do' - the actual purchasing of a service provided by a charity, social enterprise, business or public agent. This involves a 'tendering' process and is implementing around commissioning requirements.
Procurement involves:
- Purchasing - the process of securing or buying the services: and
- Contracting - the means by which the process is made legally binding
The Tendering Process
All voluntary and community organisations will need to be prepared to make sure that they meet the required standards in order to compete for funding to deliver public services. Contracts are awarded against a scoring system and many organisations could find they are competing to deliver a local service with service providers in other regions and sectors. Partnership working may also be encouraged as large contracts (as opposed to several smaller contracts) are seen as a cost-effective way of delivering publics services.
There are three different tendering procedures - open, restricted and negotiated.
Open - this is when a contract is advertised, with responding organisations being sent the full tender documentation, which may include the following:
- Letter of invitation (when and where tenders should be submitted)
- Tender document (tendering instructions)
- Specification (standards that will be scored during evaluation)
- Pricing document
- Contract conditions
- Quality requirements / methods statement questions
- Tender evaluation model (how the tender will be evaluated and contract awarded)
- Questionnaire (to assess financial standing and commitment to equal opportunities and environment issues)
Restricted - responding organisations to an advert will need to complete a questionnaire (PQQ) to assess their suitability to tender for the contract. If they pass this stage they will be sent the full tender documentation (as above). The following information could be requested in the PQQ.
- Name, address and registration number
- Financial details
- Equal Opportunities policy
- Environmental policy
- Health and Safety compliance/policy
- Relevant experience
- Capacity
- Workload and capacity
- Following a shortlist of those organisations meeting this criteria full documentation (as per open tendering) will be sent. (See resources section for sample PQQ documents)
Negotiated - used in exceptional circumstances, such as where the nature of the service is such that the specification for the service to be delivered cannot be established: importance is placed on the quality, governance systems, financial viability and risk management of tendering organisations.
The timetable to prepare a tender application can often be extremely tight, therefore we recommend that you prepare a number of documents in advance. Please click here for further details.