Constructionline selections

Constructionline selections

Selection of contractors and construction-related consultants to be invited to tender

The protocol to be used by the Council when using the Constructionline database

For purposes of ensuring fairness and transparency, the London Borough of Hammersmith & Fulham (the "Council") has put in place rules regarding the selection of contractors and consultants to be invited to tender from the Constructionline database.

Where the term “contractor” is used, this shall be deemed to relate to a contractor or a consultant as appropriate.

Selection procedure

Creation of a long list:

The production of tender lists for construction-related contracts is delegated to the Building and Property Management – Business Support Team (the “Support Team”) within the Council’s Building and Property Management Division. When receiving an instruction from a contract administrator for a list of suitable organisations to be invited to tender the Support Team will make an on-line application to Constructionline (opens a new window) and generate a provisional "long list" of approximately 18 contractors from whom the final short list of those to be invited to tender can be drawn.

The Constructionline long list will be generated on a random basis drawing upon contractors who have indicated in their application to Constructionline that they are willing to work within the Borough’s boundaries and who have been identified by Constructionline as capable of carrying out work of the value estimated by the Council for the contract to be tendered (the “Contract”). The names of the contractors are provided to the Council by Constructionline in a random order. The purpose of generating a long list of 18 contractors is to provide flexibility to allow for potential tenderers that decline to be invited to tender or that fail under one or more of the Council’s additional criteria as below.

Before contacting any contractors on the long list, the Council will carry out the following additional checks which may result in the exclusion of contractors from being invited to tender.

• Stage 1 – Health & Safety:  It will be a condition of acceptance onto the tender lists for contractors to have current CHAS (Contractors Health and Safety) Scheme certification (http://www.chas.gov.uk/), or equivalent.  This information should be recorded on the Constructionline database and is available to the Council on the CHAS Scheme database.
  
• Stage 2- Financial check:  Where the estimated contract value is below £50K, the only financial check that will normally be undertaken is to ensure that the maximum project value ("MPV") provided by Constructionline is sufficient to cover the estimated cost of the Contract. In exceptional circumstances the contract administrator may consider the contract to be of a high risk to the Council and, at their discretion, may require the procedure to be followed for contracts over £50,000 as below. 

Where the estimated contract value is £50,000 or above, the Council applies its own criteria to ensure that potential tenderers are financially sound. The first stage of this process is to carry out a financial check using an external credit reference agency – Credit Safe Ltd*. The long-list of contractors will be forwarded to the Council’s Accountancy Team based in the Financial & Corporate Services Department for this stage 1 review to be undertaken. Any potential tenderer with an unacceptably high financial risk factor (scoring less than 50% ) will automatically be excluded from consideration for progression to the next stage of the selection process.  Contractors may obtain information regarding their financial risk factor from Credit Safe .

Additionally the Council will calculate the MPV that a contractor can accommodate on the following basis: Reported Turnover [from the contractor's latest published accounts] X Risk Rating (as generated by Credit Safe Limited) X 30%. Contractors that do not have an MPV which is equal to or exceeds the estimated value of the Contract will not be invited to tender. The MPV calculated by the Council may differ from that allocated by Constructionline.

Where a contractor’s latest accounts are not publically available, representatives of the Council may contact the contractor requesting copies of its latest audited financial statements in order to enable the Council to calculate the contractor’s MPV. The contractor must comply with the request to provide its financial statements within 3 working days or such other timescale as the Council shall reasonably impose. If a contractor fails to provide the requested information within the specified timescales the Council reserves the right to treat the contractor as having failed its financial checks and exclude the contractor from progressing to the next stage of the selection process.

The Council reserves the right to carry out financial checks on an on-going basis up to and including contract award stage. If at any time these checks show that a contractor fails to meet the minimum financial requirements set out above, the Council reserves the right not to award the Contract to the contractor concerned.   

• Stage 3 – Inappropriate contractors:  The Council has the right to not award the Contract to, or invite to tender, any contractor who has been convicted of any of the offences listed in Regulation 23(1) of the Public Contracts Regulations 2006, including, without limitation, corruption, bribery, fraud, theft or money laundering.
  
• Stage 4 – Creation of a short list:  The Council will produce a short list of 6 contractors to be invited to tender from those contractors on the long list who have passed the Stage 1 to 3 assessments using the following process:

Starting at the top of the long list (excluding any contractors who failed the Stage 1 to 3 assessments) representatives from the Council will contact the contractors, in the same order that they appear on randomised list generated from the Constructionline database, to confirm if they are willing to be invited to tender, until a short list of 6 contractors to be invited to tender has been produced. Contractors will fall into one of 3 categories (1) those who agree to go on the tender list to be invited to tender; (2) those who decline to be invited; and (3) those who are not approached as the tender list has been completed.

PERFORMANCE REPORTS

On completion of the project the Contract Administrator will complete a contractor’s performance report which will be inputted into the Constructionline database.

MONITORING OF ARRANGEMENTS

An annual report will go to the Council’s Competition Board for information only on the lists generated through Constructionline.

Copies of all documents will be retained for record purposes to demonstrate the transparency of the overall selection process.

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*Creditsafe Business Solutions are part of the Creditsafe Group which now has offices across Europe in the UK, Ireland, Sweden, France and the Netherlands