Enhancing Procurement Efficiency:

Procurement Provisions and

Practices:
Consulting Services
-Shakti Prasad Shrestha
March 21, 2018

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 Consulting Services (PPA-2b(e):
“Consultancy Service” means any
study, research, survey, design,
drawing, supervision, training,
testing, software development
service or other intellectual or
professional service of a similar
nature
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 Consulting Services (Contd..)
 “Consultant” means any entity or
person that may provide or provides the
Services to the Client under the Contract.
 Intellectual and professional activities
based on skill, expertise knowledge and
experience to provide professional advice
and technical assistance such as planning,
design and implementation of projects etc.
 Which does not have physical output.

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 Usefulness of Consulting Services
 Provides access to latest technology and
expertise of particular competence as and
when required without hiring permanent
staff,
 Provides flexibility to organizations to
adapt to changing conditions with less
people employed,
 Time bound results as per agreement.
 Provides independent knowledge to the
benefit of the PE,
 Avoids conflict of interest,
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 Usefulness of Consulting Services (Contd..)

 Provides transfer of knowledge,

skill and technology to the
executing agency,
 Provides quality and cost
effectiveness,
 Support PE in the project
implementation,

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Conditions for Obtaining Consulting Services (PPA -29):

Consulting Services can be obtained in the

following conditions:
 If the work cannot be performed by the
available manpower in the PE
PE may engage consultants over defined
periods of time to complement its in-house
capabilities.
 need of specialized professional and
independent advice or
 when the permanent hiring of
professional staff is not justified,
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 Differences Between Goods/Works and Consulting
Services:
Consulting Services Goods and Works
Two stage Generally Single Stage
Emphasis on competence/
capacity qualification Generally Emphasis on Price

Knowledge Based Product Based

Short list Open competition
Terms of Reference Technical Specifications
Request for proposal Invitation for bid
Method based Negotiations Generally no negotiation
No Securities? Bid & Performance Securities
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Preparation for Procurement Proceedings :

1. Identify procurement requirements (From Units,

Sections or Divisions –Service requirement, quality,
quantity, time) (PPR-3a)
2. Collect market information about procurement
contract in practice to resolve various technical
matters and ascertain the availability of consultants
of the type required and Consultant availability
3. Study procurement proceedings of consultancy
service of similar nature that was procured in the
previous year of the procuring entity (The
experience of other public entity of hiring
consultants can also be useful)

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Preparation for Procurement Proceedings (Contd..):

4. Ascertain the details, quantity and scope of

procurement (Terms of Reference (ToR))
5. Divide the procurement into a more convenient
group or including into package (Based on ToR,
Individual or Firms, Similarity and Nature of
Service etc.)
6. Prepare Cost Estimate (PPA-5)
7. Prepare the procurement plan (Master or Annual
Procurement Plan, if necessary) (PPA-6)
8. Identify financial source (Budget, Program and
Accounting Code) (PPR-3h)

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Preparation for Procurement Proceedings (Contd..):
9. Select procurement/selection method /agreements:
(Direct or RFP Method and Selection Methods,
Contract Agreements) (
10. Prepare Procurement Document including EOI
Document, EOI evaluation criteria and RFP, RFP
evaluation criteria,
11. Conduct Procurement Proceedings: Solicitation,
Submission, Opening, Examination and Evaluation,
Evaluation Reports, Selection, Negotiation, letter of
Intent, Review (entity chief or Review Committee, if
any), Invitation for Contract Agreement and Award
of Contract)
12. Contract Implementation and follow up
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 Preparation of
Terms Of Reference
(PPR- 69)

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 Consideration in ToR:

 Should be adequate and clear for the

understanding of the assignment and
subsequently its correct execution.
 Should explain the details necessary to carry
out the assignment
 The objective & scope of work should be
realistic and consistent with the available
budget and program
 TOR should take into account the organization,
technical expertise and the institutional
strength of the Client
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 Consideration in ToR (Contd..):

(1) Background :
 Introduction of the Procuring entity and objective
detail,
 Project history, location and rational of the
assignment
 Need of consultant, issues to be resolved ,
 Source of fund
 The legal aspects of the entity, etc
(2) Objective of the Assignment :
Specify the objectives: feasibility studies; design of
project; preparation of bidding documents;
supervision of works; institutional strengthening
etc
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 (3) Scope of the Service:

 Main activities and their expected

results,
 Desired level of details (level of design,
accuracy composition of cost estimates
etc,),
 Main issues to be addressed
 Alternatives to be considered,
 Surveys and investigations,

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 4. Specific Job Responsibilities

 List the exact deliverables of the consulting services,

like:
 Preparation of the report/s
 Submit the design and survey results
 Carryout the research
 Design model
 Policy Analysis
 Supervision
 Procurement services (bid document preparation,
evaluation, training, contracts supervision/
administration etc)
 Other specific jobs which match with the objectives
and scope of services

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(5) Previous study and the basic data

Availability of Previous study and the

basic data concerning the assignment
Relevant Publications,
Research Studies,
Designs and drawings,
Reports related with the consulting
service
Databases, and
Other relevant Information
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(6) Transfer any knowledge or skill:

TOR should provide the specific

details on requirements of services
and ask consultant to propose their
approach and methodology
Trainings : Employees levels, Event,
Number of Participants, Venues,
type of trainings (Technical,
Operational, Conceptual etc.)
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 (7) The Responsibilities (functions) and
Qualifications of the Key Personnel :

 National or International
 The specific responsibilities of the Key
Personnel such as The team leader, designer,
programmer, Software engineer, network
/database administrator and their number etc
 The estimated time required for the work to be
performed by them individually, the Person
man-months, full or intermittent
 Qualification and Experiences of each
Personnel (Minimum and preferable)

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 ToR (Time and Facilities):

(8) Time for completion: Need to

mention the time for the completion
of assignment by the consultant.
(9) Facilities to the Consultant:
 Description of information, reports, data's
and facilities to be provided by the Client
 Physical facilities that will be made
available by the Client e.g.. Computers,
software, office space, vehicles, internet
service, equipment etc.
 Staffs

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 (10) Reporting requirement:

Details of the report, data, drawing and

survey report etc. to be submitted by the
consultant.
 Specify the reporting requirement eg. Inception,
Progress Reports, Interim Project reports ,Draft
Project Report , Final Project Report ,Completion
Report etc,
 Their schedule and frequency where applicable
 Format, number of copies, names of recipient of the
reports etc
Reporting requirement should be
adequate to inform the client but
should not be unnecessary reporting
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11. Institutional & Organization arrangement:

 TOR should define the institutional

arrangement for the assignment,
 Indicate the role and responsibilities of
all those involved in the organization,
 Should define the hierarchy and level
of authority of counterpart personnel ,
 Information on the level of experience
of Client’s personnel who will be
integrated in the consultant’s team.

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 12. Selection Method:

TOR should define the

applicable selection method:
Indicate selection method,
Indicate applicable Rules,
Regulations or Guidelines

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 Selection Method (Contd..):
SELECTION METHOD:
(i) Quality and Cost Based Selection
Method,
(ii) Quality Based Selection Method,
(iii) Fixed Budget Selection Method,
(iv) Least Cost Selection Method
(v) Single source/Direct contracting
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Cost Estimate of
Consulting Service
(PPR- 12)

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 Cost Estimate of Consultancy Service:

The TOR is the basis for preparation

of the cost estimate.
Therefore, the accuracy of the
estimate increases with the extent of
service requirement details in the TOR
Currency of cost estimate

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 Cost Estimate of Consultancy Service
(Contd..):

Cost Estimate of consultancy service is a must

For cost estimate following matters shall be taken
into account:-
(a) The norms prepared by the PE,
(b) ToR of the concerned consultancy service,
(c) Actual cost incurred on the procurement of
the same nature made in the current or previous
years by the concerned Public Entity or other
Public Entity.
Cost estimate shall be prepared by adjusting price
to the rate of previous years.

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 Cost Estimate: Component of costs:

Cost estimate shall include the following

costs:
 Remuneration: Key Professional and other
manpower,
 Reimbursable Expenses: Travel, residential
for manpower, office expense, necessary
goods, equipment and services expenses,
report translation, printing expense etc
 Provisional Sum: For training, seminar and
travel, and equipment
 Contingencies): Price adjustment and
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 Reimbursable Expenses:

 Travel and transportation (international &

local)
 Vehicles
 Staff allowance (overseas allowance, per
diem, subsistence allowance)
 Communication: reasonable monthly allocation
of local and international communication
 Office/or rent ,
 Supplies, equipment
 Insurance
 Survey and investigations
 Report and Printing

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 Provisional Sums & Contingencies:

 Provisional Sum:
 Training, Seminar Workshops etc.
 Equipment / other Procurement
needed to complete the works
(Software + Hardware)
 Contingences (Physical and
price): Not more than 20 percent
of the cost estimate?
 Provisional Sum & Contingences are not
competitive part.
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Request for Expression of
Interest (REOI)
(PPA-30 & PPR- 70)

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Short List to be Prepared through REOI
(PPA- 30.3):

International level EOI is invited in the following

circumstances:
 If the threshold of NRs. 10 crore generally exceeds (PPR-
70.2),
 If the consultancy service is not available under
competitive price from more than one consultant within
Nepal,
 If no proposal has been submitted in response to invitation
to national level proposal, and the service has to be
procured from foreign consultant,
 If it is necessary to obtain services from International
consultant in accordance with an agreement with the
donor
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Short List to be Prepared through REOI
(Contd..):

 Public Entity shall have to seek the approval from

one level higher authority to invite an international
level EOI.
 For Procuring Consulting Service more than NRs.
20,00,000.00 public notice for EOI in national
newspaper and online REOI is required.
 For EOI, minimum 15 days notice is required,
 For Procuring Consulting Service more than NRs.
20,00,000.00 and upto NRs. 10,00,00,000.00, EOI
shall be asked only from national consultants

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EOI Evaluation Criteria is to prepared before
publishing EOI Notice:

 Legal eligibility- Firm Registration, VAT/PAN

Registration, Tax clearance- must
 Qualification and Experience of Key Experts –
[30 to 50% marks]
 General & Specific and Similar Geographical
experience of Consulting Firm – [40 to 60%
marks]
 Financial Capacity & Infrastructure/equipment
related to the proposed assignment – [10 to
20% marks]
Note: Approved EOI evaluation criteria shall not
be changed once EOIs are opened. 33
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 EOI Notice:

 Standard EOI Document to be used

 Name of the PE
 Description of proposed assignment
 Source of Funding
 Organization, Qualification and Experience of
Consulting Firm
 In case of JV, name of lead partner and name of other
partners
 Qualification and experience of Key experts
 Selection Method
 EOI Submission Date and opening Date
 EOI submission modality
 Contact Address
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 Short Listing:

PE shall have to select a consultant capable of

providing such consultancy service
While selecting an international level consultant,
firm or company from various country, backgrounds
and having a local agent have to be selected.
 Shortlisting based on pre-disclosed criteria
 Three to Six firms are to be shortlisted
 If not three firms are not shortlisted re-invitation
for EOI needed
Renowned consultant who has not submitted EOI
may be included in the short list by contacting them)
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 Short Listing:

 If at least three consultants fail to

be shortlisted even after publishing
a notice for the second time, the
short list may be prepared only the
consultants to the extent selected.
 PE shall have to provide
information of the shortlist to all
the firms who have submitted EOI.
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 Request for
Proposal (RFP)

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 Request for Proposal
:

 Standard RFP Document to be

used
 To be sent to the shortlisted
consulting firms
 Before sending RFP, RFP
evaluation criteria to be prepared
and approved

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 Evaluation criteria for RFP
:

Experience of the firm in specific Up to twenty five percent of the

assignment total marks

Methodology and responsiveness to Twenty to thirty five percent of the

the terms of reference total marks

Qualifications and experience of the Thirty to sixty percent of the total

key personnel marks

Technology transfer or training Up to ten percent of the total marks

Participation of domestic manpower Up to ten percent of the total marks

in case of International

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 Request for Proposal (Contd..)
:

 Instruction to Consultants
 Separate envelope for Technical
and Financial Proposal, should be
enclosed in outer envelope
 Weightage for Technical and
Financial Proposal
 Terms of Reference
 RFP Evaluation criteria
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 Request for Proposal (Contd..)
:

 Pre-proposal meeting, clarification and

Addendum
 Proposal submission place, time and
date
 Proposal validity period
 Selection method
 Opening of technical and Financial
Proposal
 Review Procedures
 Terms and conditions of the Contract 41
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 Request for Proposal (Contd..)
:

 Pre-proposal meeting
 Proposal submission place,
time and date
 Proposal validity period
 Selection method
 Terms and conditions of the
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 Request for Proposal (Contd..)
:
 Opening of technical Proposal
 Evaluation of technical proposal
 RFP Evaluation Report
 Approval on the evaluation
Technical Proposal
 Invitation for Financial Proposal
opening to the successful
consultants
 Opening of Financial Proposal
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 Request for Proposal (Contd..)
:

 Evaluation of Financial Proposal

 Combined Evaluation
 Selection of Consulting firm
 Approval on the evaluation
Technical Proposal
 Invitation for contract negotiation
 Letter of Intent, Review procedure

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 Request for Proposal (Contd..)
:

 Approval
 Letter of award
 Signing of contract
 Contract implementation

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Thank You

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