Part 8 - Contract Rules

Search the Constitution

Contents

1. Introduction
2. Purpose of the Rules
3. Application
4. Authority
5. Transparency Obligations
6. Buying / Procuring / Obtaining Goods, Services and Works
7. Exclusions and Exceptions to Contract Rules
8. Purchasing Schemes
9. Reporting Requirements
10. Entering into a Contract
11. Legal Consideration
12. Contract Rules - Appendix A
13. Contract Rules - Appendix B
14. Contract Rules - Appendix C

1. Introduction

• 1.1 S.135, LGA 1972 ("s.135") includes as follows:

  •  (1) "A local authority may make standing orders with respect to the making of contracts by them or on their behalf";

  •  (2) "A local authority shall make standing orders with respect to the making by them or on their behalf of contracts for the supply of goods or materials or for the execution of works".

• 1.2 These Contract Rules ("Rules") are the Council's Contract Standing Orders made in accordance with s.135.

• 1.3 The Procurement Legislation ("the Procurement Legislation") referred to in these Rules include (but are not limited to) the following:

  • Public Contract Regulations 2006 (PCR2006)

  • Public Contract Regulations 2015 (PCR2015)

  • Procurement Act 2023 (PA2023)

  • Procurement Regulations 2024 and Guidance issued by the Cabinet Office

• 1.4 "Threshold" refers to the relevant financial thresholds relating to Goods & Services, Works, Concession contracts and Light Touch contracts as set out in the applicable Procurement Legislation and published on the Procurement Intranet page, as amended from time to time.

• 1.5 You are procuring something when you are initiating or carrying out the process of acquiring goods, services or works from an external source.

  This includes, but is not limited to:

  • · Requesting quotes or tenders from suppliers or contractors.

  • Raising a purchase order or contract.

  • Engaging in negotiations with vendors for pricing or terms.

  • Committing funds for the acquisition of goods or services.

  • Receiving and accepting goods or services in exchange for payment.

    In essence, if you are taking steps that lead to the commitment of public funds to obtain something from outside the organisation, you are procuring.

• 1.6 You are entering a contract whenever you make a formal agreement—written or verbal—that commits the council to receive goods, services, or works from an external provider in exchange for payment or other value.

  This includes:

  •  Signing a contract or agreement with a supplier or contractor.

  • Accepting terms and conditions (including online or email confirmations).

  • Issuing a purchase order that is accepted by a supplier.

  • Agreeing to a quote or proposal that results in a commitment to pay.

• 1.6.1 Renewing or extending an existing contract.

• 1.6.2 Providing funding or a grant to an external organisation.

Back to top

2. Purpose of the Rules

• 2.1 These Rules do not provide guidelines on the best way to purchase works, supplies and services but, rather, they set out minimum requirements to be followed.
• 2.2 These Rules provide a structure within which procurement decisions are made and implemented to ensure that the Council furthers its corporate objectives in an efficient manner leading to procurement of quality supplies, services and works.
• 2.3 These Rules protect the legal position of the Council in respect of compliance with the law and in its contractual dealings with external suppliers and contractors. They protect the interests of Members, Officers and the citizens of West Berkshire

Back to top

3. Application

• 3.1 These Rules apply to:

  • 3.1.1 purchases by or on behalf of the Council of works, supplies and services;
  • 3.1.2 all contracts including (but not limited to) purchase orders, consultancy agreements, service level agreements, software licences, concessions and contractual arrangements entered into by or on behalf of the Council, except for contracts and purchasing methods expressly excluded under Procurement Legislation.
• 3.2 The Monitoring Officer (or any officer nominated by the Monitoring Officer for the purpose) shall be responsible for interpreting these Rules.
• 3.3 If a Governing Body of a school under the control of the Council as Local Education Authority intends to enter into a contract for works, supplies or services, the Headteacher or such persons delegated for the purpose by them must follow these Rules.
• 3.4 Every purchase, contract or official order for works, supplies or services made by the Council shall be for the purpose of implementing the Council's policies and must be made in accordance with the Council's duties of Best Value, Equality, Sustainable Commissioning and its Social Value Policy.
• 3.5 When proposing to procure or make arrangements for procuring a service contract where the estimated value exceeds the Threshold for Goods & Services, consideration must be given as to how the procurement or contract might improve the economic, social and environmental wellbeing of West Berkshire, as required by the Public Services (Social Value) Act 2012, and the Council's Social Value Policy.
• 3.6 Annexed are Appendices comprising Tables referred to.

Back to top

4. Authority

• 4.1 All contracts must be in accordance with a decision:
  • 4.1.1 of the Council; or
  • 4.1.2 of the Executive; or
  • 4.1.3 within the Council's Scheme of Delegation by:
  • 4.1.3.1 an Executive Decision Maker;
  • 4.1.3.2 a Council Committee or Sub-Committee; or
  • 4.1.3.3 an officer or their delegate for the purpose.
• 4.2 No contract shall be entered into unless it is in accordance with an existing budgetary provision within the Budget approved by the Council.
• 4.3 Any contract award with a value over £500,000 is a Key Decision of the Council.
• 4.4 Where a Service Director does not have delegated authority to enter into a contract, approval in accordance with Appendix A is required before the contract can be awarded.

Back to top

5 Transparency Obligations

• 5.1 Local authorities in England have an obligation to publish details of their spending and procurement activities to promote openness, accountability, and public trust. Under the Local Government Transparency Code 2015, councils must publish:
  • 5.1.1 Expenditure exceeding £500, including payments to suppliers and contractors.
• 5.2 Details of every invitation to tender for contracts to provide goods and/or services with a value that exceeds £5,000.
  • 5.2.1 A register of contracts, including those in progress and those awarded, with key information such as the contract value, duration and supplier.
• 5.3 Service areas are therefore responsible for reporting contract information to the relevant board on a monthly basis in a format as required by Procurement Legislation.

Back to top

6. Buying / Procuring / Obtaining Goods, Services and Works

Preliminaries

• 6.1 It is the responsibility of the Chief Executive, Executive Directors, Service Directors, and Budget Holders to ensure all purchases of supplies and services and works comply with:
  • 6.1.1 all relevant statutory requirements;
  • 6.1.2 the relevant Procurement Legislation;
  • 6.1.3 the Council Constitution including these Rules, the Financial Rules and Scheme of Delegation;
  • 6.1.4 any code, guidance or conditions approved by the Governance Committee and/or the Executive and/or the Council and/or the Health and Wellbeing Board to the exercise of powers delegated by them;
  • 6.1.5 any conditions attached by the Executive or the Council to the exercise of powers delegated by them;
  • 6.1.6 the guidance and updates (available from time to time) on the Legal and/or Procurement intranet pages (to include Consultancy Guides) and other policies and procedures of the Council as appropriate.
• 6.2 In the event of conflict between the above, the Procurement Legislation will take precedence, followed by the requirements detailed in 6.1.6 above.
• 6.3 A procurement process which is compliant with Contract Rules may include running a Request for Quote (RFQ) for below Threshold procurements, running an Invitation to Tender (ITT) for above Threshold contracts or using a Further Competition through a compliant Framework Agreement for both above and below Threshold contracts.

Financial Thresholds and Procedures

• 6.4 Officers undertaking procurement are responsible for ensuring that all persons awarded contracts for the supplies, services or works to the Council meet the Council's minimum standards of suitability, capability, legal status and financial standing.

• 6.5 The financial value thresholds at which processes become mandatory are published on the Procurement intranet page.

• 6.6 It should be noted that whilst most procurements will now be undertaken in accordance with PA2023, due to the transitional arrangements of PA2023, the PCR 2015 will continue to apply to some procurement exercises. The procurement team will advise on the applicable legislation to your procurement.

Advertising

• 6.7 There is a general presumption in favour of competition.

• 6.8 All contract opportunities being advertised by the relevant Service Director should be done so electronically on the Council's Procurement Portal to ensure that such opportunities also appear on the Central Digital Platform (CDP) database.

• 6.9 For opportunities relating to works, services and supplies which fall below the relevant Threshold, a UK Government Certified national database can be used to select tenderers.

• 6.10 All contract opportunities which are above the relevant Procurement Legislation thresholds must be advertised on the CDP database (a web-based portal provided by the Cabinet Office) prior to such advertisement appearing on any other advertising medium (such as a trade journal etc). However, where a Further Competition is undertaken via a compliant Framework Agreement, an invitation will be sent to those providers on the Framework only and no further advertisement will be required.

• 6.11 Where the contract is of potential cross border interest then it must be publicised to ensure that tenderers from other member states have an opportunity to participate and the process is conducted in a fair and transparent manner.

• 6.12 Where a contract is above the relevant Procurement Legislation financial threshold there are two main types of procedure available under PA2023:

  • Open Procedure; and

  • Competitive Flexible Procedure.

• 6.13 Care must be taken to ensure that the correct and most appropriate procedure is used and advice is sought from the Procurement and Commissioning team and Legal team as necessary on the choice and use of procedures detailed in the Procurement Legislation.

• 6.14 CDP notices must be approved and issued by the Service Lead for Procurement and Commissioning or their delegate as appropriate, who will also assist in the conduct of the procurement.

Contract Value and Aggregation

• 6.15 Total Contract Value is a genuine estimate of the total value over the full potential duration of the contract, not just the initial term. This includes:

  • All planned extensions (even if optional)

  • The maximum possible duration and value, even if the contract may be terminated earlier

  • The value of any option(s) (e.g. for additional goods/services) in the contract whether these options are taken or not

  • Value Added Tax

• 6.16 There shall be no artificial splitting or disaggregation of a contract to avoid the application of the provisions of the Procurement Legislation and/or these Rules.

• 6.17 The Procurement Legislation can cover contracts which are initially below the stated relevant Threshold where they constitute repeat purchases and/or purchases of a similar type in a specified period. Officers responsible for such procurement should therefore seek advice on the application of the Procurement Legislation where they envisage that they may be required to make such purchases

Principles and Evaluation

• 6.18 All tendering procedures (including obtaining quotes), from the planning stage to contract award and execution (seal or signature), shall be undertaken in a manner to ensure:

  • sufficient time is given to plan and run the process (this should include any mobilisation or implementation time that is required);

  • equal opportunity and fair treatment;

  • openness and transparency;

  • proportionality;

  • probity;

  • outcomes that deliver sustainability, efficiency and cost savings (where appropriate).

Submission and Opening of Tenders

• 6.19 An electronic Invitation to Tender shall be issued by the Council for all contracts with an estimated value that is more than the appropriate Threshold and tenders shall be submitted electronically by tenderers via the Council's Procurement Portal.

• 6.20 The Council Procurement Portal and the Invitation to Tender must specify the format in which an electronic tender is to be submitted by tenderers and such tenders shall be stored in a secure portal account which is locked until the date and time specified for its opening.

• 6.21 No tender received after the time and date specified for its opening shall be accepted or considered by the Council unless the Monitoring Officer is satisfied that there are exceptional circumstances and the other tenders have not been opened.

• 6.22 The electronic opening of tenders submitted on the Procurement Portal shall be conducted by a Procurement Officer with an audit record being maintained on the e-tendering system.

• 6.23 Evaluations of Quotes and Tenders

• 6.24 All quotes and tenders shall be evaluated in accordance with evaluation criteria notified in advance to those submitting quotes/tenders.

• 6.25 Tenders subject to the provisions of the Procurement Legislation shall be evaluated in accordance with the legislative provisions. Advice from the Procurement team may be sought on the selection and evaluation criteria.

• 6.26 Save in exceptional circumstances approved in advance by the relevant Service Director all contracts shall be awarded on the basis of the quote or tender which is most advantageous and represents best value for money to the Council having regard to the provisions of the Social Value Policy, and not only on the basis of lowest price

Back to top

6. Exclusions and Exceptions to Contract Rules

Exclusions

• 7.1 The requirement to conduct a competitive procurement process is excluded in the circumstances detailed in Appendix C.

Exceptions

• 7.2 Subject to 7.4 the requirement for the Council to conduct a competitive purchasing process, contracts with a value of more than £24,999.99, may be excepted or waived in the following circumstance:

  • 7.2.1 for contracts which are not subject to the relevant Procurement Legislation Rules, the work, supply or service is required as a matter of urgency and a delay would be likely to lead to financial loss, personal injury or damage to property; or

  • 7.2.2 at the discretion of the relevant Executive Director and/or the Chief Executive, acting lawfully, who may proceed in a manner most expedient for the efficient management of the Council with reasons recorded in writing.

• 7.3 Only the Monitoring Officer and/or the S.151 Officer may grant a waiver or an exception to these Rules, subject to exception values and delegation thresholds detailed in these Rules and/or elsewhere in the Constitution. An officer who seeks a waiver of these Rules shall do so only in advance and only in exceptional circumstances.

• 7.4 Exception values and delegations:

  • 7.4.1 for all contracts up to the Threshold, the S.151 Officer must approve the exception;

  • 7.4.2 for contracts above the relevant Threshold and up to £500,000, the S.151 Officer will consult with the Monitoring Officer and the appropriate Executive Director provided and an exception report has been approved by the relevant board unless 7.3 applies and for reasons of urgency such prior approval is not possible in which case a report will be supplied retrospectively;

  • 7.4.3 for contracts over £500,000 the S.151 Officer and the Monitoring Officer will make a recommendation to the Executive provided an exception report has been prepared and approved by the relevant board and Corporate Board.

• 7.5 All exceptions or waivers to these Rules must:

  • 7.5.1 be fully documented;

  • 7.5.2 for any contract where the requirement to hold a competitive process is not excluded by the Procurement Legislation, be subject to a written exception report to be submitted in advance to the relevant board by the relevant Service Director / Head of Service, Service Director or Executive Director (which shall include reasons for the exception or waiver which demonstrate that the exception or waiver is genuinely required);

  • 7.5.3 be subject to approval by the S.151 Officer who shall record they have considered the reasons for the waiver and that they are satisfied that the circumstances justifying the waiver are genuinely exceptional (applications for waivers which are a result of poor contract planning will rarely be considered genuinely exceptional);

  • 7.5.4 have had relevant approval sought under these Rules.

• 7.6 For contracts subject to the Procurement Legislation, any waiver or an exception from the requirement for competition must meet the conditions set out in the Procurement Legislation in addition to the general requirements above.

• 7.7 The exclusions that apply to the competitive procurement process are set out at Appendix C.

Back to top

8. Purchasing Schemes

• 8.1 A "Purchasing Scheme" may include:

  • 8.1.1 contractor prequalification lists/select lists;

  • 8.1.2 framework arrangements (including those set up by authorised central purchasing bodies such as Crown Commercial Services, other contracting authorities and by the Council itself);

  • 8.1.3 Dynamic Purchasing Systems (including those set up by authorised central purchasing bodies such as Crown Commercial Services, other contracting authorities and by the Council itself);

  • 8.1.4 Dynamic Markets (including those set up by authorised central purchasing bodies such as Crown Commercial Services, other contracting authorities and by the Council itself);

  • 8.1.5 consortium purchasing;

  • 8.1.6 collaborative working arrangements;

  • 8.1.7 other similar compliant arrangements.

• 8.2 An officer responsible for a procurement exercise may use a Purchasing Scheme provided that they have sought advice to confirm that:
  • 8.2.1 the Council is legally entitled to use the Purchasing Scheme;
  • 8.2.2 the purchases to be made do properly fall within the coverage of the Purchasing Scheme;
  • 8.2.3 the establishment and operation of the Purchasing Scheme complies with the Procurement Legislation (where such applies) and meets the Council's own requirements.
• 8.3 Where a Purchasing Scheme is used there shall be a whole or partial exemption from the obligations under these Rules in respect of the choice and conduct of procedures. Advice should be sought from Commissioning and Procurement Team prior to entering to such arrangements.

Back to top

9. Reporting Requirements

• 9.1 A written report in accordance with the Procurement Legislation shall be produced by the relevant Service Director for each contract that is awarded which is above the Threshold and subject to the Procurement Legislation (the Procurement Legislation places an obligation on the Council to document, for each procurement, key decisions and steps taken and stages leading to the award of contracts).

• 9.2 This report may be requested by the Cabinet Office and shall be kept for three years.

• 9.3 In addition to the above, the relevant Service Director should document the progress of all procurement procedures (regardless of value) including ensuring sufficient information is kept to justify decisions such as communications with contractors and internal deliberations, preparation of procurement documents, any dialogue and negotiation, selection and award. Such documentation must be kept for three years from the award of the contract.

Back to top

10. Entering into a Contract

• 10.1 There should be written evidence of all purchases (which shall include electronic evidence).

• 10.2 All contracts entered into by the Council as detailed in Appendix B must be in writing in a form approved by the Monitoring Officer or their delegated officer.

• 10.3 Legal Services shall retain all contract documents that are sealed on behalf of the Council.

• 10.4 The relevant Service Director must formally notify the Service Lead for Commissioning and Procurement (or nominated officer) of the award of all contracts for the purpose of it being recorded on the Council Contract Register.

• 10.5 Every contract shall include the standard clauses set out in the relevant Standard Form of Agreement issued and updated from time to time by the Monitoring Officer or their nominated officer and available from Legal Services.

• 10.6 Where a Standard Form of Agreement is to be amended, the form of contract shall be prepared/amended by the relevant Service Director for approval by the Monitoring Officer or their delegated officer.

• 10.7 As a minimum, where appropriate, all contracts shall include clauses setting out:

  • 10.7.1 the works, supplies/goods, services, material, matters or things to be carried out or supplied;

  • 10.7.2 the time within which the contract is to be performed;

  • 10.7.3 the quality requirements and/or standards that must be met;

  • 10.7.4 requirements on the contractor to hold and maintain appropriate insurance;

  • 10.7.5 the consequences of the contractor failing to comply with contractual obligations in whole or in part;

  • 10.7.6 requirements on the contractor to comply with all relevant legislation, including (but not limited to) equalities and health and safety legislation;

  • 10.7.7 clauses regarding personal data and its use by the contractor and/or the Council respectively. Service Directors must ensure that a Data Protection Impact Assessment is completed for all contracts to inform such clauses.

  • 10.7.8 the entitlement of the Council to cancel the contract and recover losses in the event that the contractor acted improperly (e.g. seeking to influence the Council to give the contractor any contract) or committed an offence under the Bribery Act 2010.

  • 10.7.9 payment obligations requiring that:

    • 10.7.9.1 any payment due from the Council is made no later than 30 days from the date on which the relevant invoice is regarded as valid and undisputed; and

    • 10.7.9.2 any subcontract imposes the same obligations upon the subcontractor, and requires that the subcontractor imposes such obligations in any further subcontract.

  • 10.7.10 All contracts shall include relevant specifications and/or briefs/technical requirements which are prepared taking into account the need for effectiveness of delivery, quality, sustainability and efficiency (as appropriate) and the need to be able to enforce the delivery of those requirements.

Back to top

11. Legal Consideration

Indemnities

• 11.1 No relaxation of full indemnities releasing the Council from all liability whether provided by public liability insurance or other instrument shall be allowed unless authorised in writing by the Monitoring Officer and the S.151 Officer or their nominated officers.

Risk Assessment and Performance Bond

• 11.2 Where a contract is estimated to exceed £500,000, in value or amount and is for the execution of works (or for the supplies or services by a particular date or series of dates) the relevant Service Director should consider requiring a performance bond (for an amount equal to at least 10% of the value of the contract) from the contractor (to provide sufficient security for the due performance of the contract).

• 11.3 The bond must be in a form approved by Legal Services and must be included in the Invitation to Tender.

• 11.4 If a performance bond is not considered to be necessary, the relevant Service Director must:

  • 11.4.1 undertake a risk assessment in writing; and

  • 11.4.2 seek approval from the Service Director for Finance and Property; and

  • 11.4.3 keep a copy of the risk assessment on the contract file for inspection.

Insurances

• 11.5 Every contract should be assessed for risk. If the risk assessment identifies the need for insurance the Service Director must:

  • 11.5.1 in consultation with the Service Director for Finance and Property or nominated officer set adequate levels of insurance cover (including employer's liability, public liability and any other as determined by the needs of the particular contract);

  • 11.5.2 in consultation with the Service Director for Finance and Property or nominated officer ensure that such insurances are held by the contractor and that the policies concerned are up to date (and/or renewed, as necessary, during the relevant period);

  • 11.5.3 in consultation with the Service Director for Finance and Property or nominated officer who must ensure the contractor's status under the Inland Revenue Construction Industry Tax Deduction Scheme (for construction contracts);

  • 11.5.4 in consultation with the Service Director for Finance and Property set an appropriate level of professional indemnity insurance for each specific contract that require professional and/or design services (this should not be a standard level but be assessed on a case by case basis).

Sealing

• 11.6 The Common Seal of the Council (the "Seal") shall be in the Custody of the Monitoring Officer and kept in a safe place at their discretion.

• 11.7 The Seal may be affixed, physically or electronically, to any document or proposal that has been approved by a resolution of the Council or Executive, or of an appropriate Committee, or by an officer with delegated powers.

• 11.8 The affixing of the Seal shall be attested and witnessed in writing by the Monitoring Officer or an officer duly designated by them in accordance with the delegated powers conferred by the Council.

• 11.9 An entry of every sealing of a document shall be made and consecutively numbered in a book or electronic record to be provided for the purpose and shall be signed (including a digital signature) by the person attesting the sealing.

• 11.10 The Seal shall be affixed, physically or electronically, to any document required to be sealed, including but not limited to:

  • 11.10.1 a petition to be presented to Parliament against the promotion of any Bill or confirmation of any Provisional Order which the Council opposes;

  • 11.10.2 a mortgage;

  • 11.10.3 an incomplete form of transfer for the duly authorised sale of securities by the Council as necessary for the purposes of dealing with stocks and shares in accordance with the Stock Transfer Act 1963.

• 11.11 All contracts whether for goods, services, works or concession contracts the value of which is above Threshold shall be sealed.

Signature of Documents

• 11.12 Where any document will be a necessary step in legal proceedings on behalf of the Council it shall, unless any enactment otherwise requires or authorises or the Council shall have given the necessary authority to some other person for the purpose of such proceedings, be signed by the Monitoring Officer or duly authorised officer.

• 11.13 Where it becomes necessary to execute any document on behalf of the Council not required by law to be under seal, the Monitoring Officer or an officer designated by them in accordance with the delegated powers conferred by the Council shall be deemed to have authority to sign such a document accordingly. A register of such documents shall be kept by the Monitoring Officer or officer duly designated by them.

Counsel:

• 11.14 Only the Monitoring Officer (or nominated officer) shall have discretion to select and instruct Counsel.

Back to top

Contract Rules - Appendix A

Delegated authority to enter into contracts - limits and thresholds

Back to top

Contract Rules - Appendix B

Financial thresholds and mandatory processes

Table showing the financial value thresholds at which processes become mandatory. The thresholds apply to contracts for goods, services, works, concession contracts and light touch contracts.

Back to top

Contract Rules - Appendix C

Exclusion of competitive procurement process

The requirement to conduct a competitive procurement process is excluded in the circumstances detailed below.

Back to top