Case Study: Procurement of Consulting Services

A government agency wanted to engage the services of a consultant for the design,
development, and installation of an on-line system for business processes. During the pre-
procurement conference, the Bids and Awards Committee (BAC) agreed that the use of
quality-based evaluation in the selection of consultants shall be recommended to the
head of the agency. The head of agency approved the use of said evaluation
procedure.

The invitation for the project which has an approved budget of P20,000,000 was
advertised twice in a newspaper of nationwide general circulation, and posted in the
agency’s website, in the Government Electronic Procurement System, and in
conspicuous places in the agency premises. Eight (8) firms responded by submitting their
Letters of Intent (LOI) and subsequently their eligibility documents on or before the
deadline specified in the Invitation to Apply for Eligibility and to Bid (IAEB).

During the eligibility check conducted by the BAC, the first six (6) firms submitted all the
required eligibility documents, while the last two (2) firms, Company G and Company H,
both had a missing document. The BAC decided to waive the eligibility requirement that
was missed and declared all eight firms as eligible. After evaluating the eligibility
documents submitted by the 8 eligible bidders based on the criteria indicated in the
IAEB, the BAC determined the ratings of the 8 bidders as follows:

1) Company A - 63 points
2) Company B - 48 points
3) Company C - 37 points
4) Company D - 36 points
5) Company E - 34 points
6) Company F - 21 points
7) Company G - 12 points
8) Company H - 10 points

During shortlisting, the BAC deliberated on the number of firms to include in the shortlist
and agreed to have a shortlist of six (6) firms. The top 6 firms were informed of their
inclusion in the shortlist through a letter signed by the BAC Chairman and the last 2 firms
were also informed of their non-inclusion. A request for proposal (RFP) was forwarded to
the 6 firms stating, among others, the place and deadline for the submission of the
technical and financial proposals.

A pre-bid conference was scheduled on 11 January 2006 while the deadline for
submission of technical and financial proposals was set on 23 January 2006, 10:00 a.m. at
the Conference Room at the 3rd floor of the agency’s building. The BAC made
attendance of the 6 firms in the pre-bid conference mandatory, failure to attend being a
ground for disqualification of the firm. All 6 firms attended the pre-bid conference and
the minutes of the pre-bid conference were issued to the 6 bidders three days later.

Three of the six firms submitted their technical and financial proposals on or before the 23
January 2006, 10:00 a.m. deadline at the 3rd floor Conference Room. The fourth firm
(Company D) arrived at the 3rd floor Conference Room at 10:03 a.m. and insisted that its
technical and financial proposals be accepted as they were in the building at 9:57 a.m.
as recorded in the security guard’s logbook. The BAC decided to accept the technical
and financial proposals of Company D. Two other firms, Company E and Company F, did

Capacitating Civil Society Organizations’ Procurement Trainers, Observers, and Monitors

Training of Trainers
not submit proposals as they felt that not enough time was given to prepare the
proposals considering the large scope of the project.

The BAC started opening the technical envelopes of the four firms at the time indicated
in the RFP to determine the presence of the required technical documents. The first
three firms submitted all the required technical documents. Company D submitted an
unsigned document and was declared disqualified by the BAC for failure to pass all the
technical requirements. After agreeing with the declaration of the BAC on its
disqualification, Company D accepted its financial proposal that was returned
unopened by the BAC.

Prior to the detailed evaluation of the technical documents submitted by the 3

complying firms, the BAC deliberated and approved the sub-criteria and the
corresponding weights to be given. Based on the approved criteria/sub-criteria, the BAC
rated the 3 firms, resulting in the following rankings:

1) Company A - 85.9 points

2) Company B - 75.9 points
3) Company C - 36.2 points

The BAC sent a letter to Company A informing the firm that it submitted the highest rated
bid and inviting it for contract and financial negotiations. The authorized representative
of Company A met with the BAC and discussed, among others, its financial proposal.
Upon opening of the financial proposal of Company A, the submitted bid price was read
as P20,300,000, exceeding the ABC by P300,000. The BAC checked the calculation of
company A and it determined the correct bid price to be P20,050,000, still exceeding the
ABC by P50,000. Company A offered a discount of P50,000 so that the cost of its financial
proposal shall not exceed the ABC. The BAC satisfied with the high technical score
obtained by Company A, accepted the discount offered.

Negotiations were successfully completed. Company A was considered to have

submitted the highest rated and responsive bid after passing postqualification.

The BAC will deliberate on the award of contract. What steps, if any, are not consistent
with the provisions of the IRR-A relating to the procurement of consulting services?