PF 1101PF4102_ Contract and Procurement Management. PF4102: Contract and Procurement Management Notes

Lecture 1 Comparison of PSSCOC, SIA and REDAS PSSCOC | SIA | REDAS Stands for | Public Sector Standard Conditions of Contract For Construction Works | Singapore Institute of Architects | Real Estate Developer’s ...

Lecture 1 Comparison of PSSCOC, SIA and REDAS PSSCOC | SIA | REDAS Stands for | Public Sector Standard Conditions of Contract For Construction Works | Singapore Institute of Architects | Real Estate Developer’s Association Used in | common contract form to be used for all public sector construction projects. | Commonly used for private sector projects Remarks | Has different versions for D&B and DBB projects. D&B DBB: Consultancy Contract, Singapore mostly uses this. No retention sum. | Most commonly used for D&B contracts | Most commonly used for Design Bid Build contracts Similarities | Each of these comes with different variants, such as lump sum, BQ etc Lecture 2: Procurement ● Criterias: Transparency, open and fair competition, value for money. ● Sourcing Contractors: Open Tender, Selective Tender, Limited Tender. (Comparison of different types of tenders- their advantages and disadvantages- is on page 38,39) - Prequalification of tenders - Contractors Registration system ● Price Quality Method (PQM) -Construction Contracts - Slide 12 - One envelope system: WHY NOT One envelope system: tenderer submit their tender proposal in 1 envelope. Government projects have to be of certain standards, emphasis on pricing first might compromise on quality aspect. - Two envelope system: quality will be separate from bidding price. Tenderers are required to submit their tender in two envelopes. Assessment of technical proposal first, before opening the financial proposal. Quality needs to reach the benchmark for price envelop to be considered. Technical proposal - comprises all the non-pricing sections (eg quality control, site organisation, project layout plan etc) Financial proposal → comprises the tender price plus all the pricing sections (eg priced BQ or schedule of works) ; Technical proposal → comprises of non pricing sections of the tender proposal (eg construction methodology, quality control etc) ★ Assessment of Quality: Slide 14 ★ Quality score computation: Slide 15, 17 ★ Price Score computation: Slide 16, 17 ● QFM - Quality Fee Method (Consultancy Contracts) ★ Weightage: Quality: 50-70%, productivity: 20%, Fee: 30-10% ★ Quality-based, open and transparent, resource-efficient Competition Vs Negotiation Factors | Competition | Negotiation Definition | - invite contractors to provide the best possible price for a defined scope of work. - Once all bids are | - owner negotiates a price for services rendered with a single contractor. - contractors do not compete against each other submitted, the lowest bid is typically chosen, winning contractor signs a contract to begin work. - enables the owner to compare prices before work begins. | for the lowest possible price and - owners are not provided comparative pricing.Lecture 3: Project Delivery Methods Procurement Options/ Project Delivery Methods Procure ment Options | Characte ristics | Payment | Example s | Sourcing Contractors | Why use this method? Design Bid-Build | Owner engages Consulta nts to design the project and draft tender documen ts and also construct | - Lump Sum - Bill of Quantiti es | HDB Condos Commo n facilities | - Open Tender - Selective Tender | -Traditional - used widely in SG - Can use ECI Design & Build | Owner is still involved in preparati on of brief etc ECI | - Lump Sum -Cost Plus | Water fabricati on plants | Selective Tender | - No need to enter into separate contracts with Architect, Engineers and other professionals -Practical and buildable design -reduction in time -reduction in cost Construc tion Manage ment | Construc tion Manager to plan, coordinat e, control a project from beginnin g to completi on | Fixed fee basis | MBS | Selective Tender | - In large projects to achieve specialization Turnkey | Employe r has V MINIMAL input. | - Lump Sum (Staged payment s) | Speciali zed works (eg: rides in | Limited Tender | - Specialist designs - Cost plus | amusem ent parks) Private Public Partners hip (PPP) DFBO DBO | Govt contribut es the license. | - Annual Payment from Public Service Authority - Busines ses such as events, F&B, other income | - Singapo re Sports Hub - ITE College West - Tuas Desalina tion plant | Selective Tender | A reduction is time, cost and resources without changes in partiesPayment Methods Comparison Paym ent Metho d | What it is | Risk to contractor | Risk to owner Lump Sum | Contractor ascertains the quantities of work for himself. Errors in quantifying during preparation of tender will not be compensated by owner. | Highest (Contractor takes risks of errors in remeasurement, errors in quantifying during preparation of tender will not be compensated) | Lowest (Fees for drafting and collating a lump sum tender is less than those for BQ tender, overall less costly to the Owner) Bill of Quant ities | Contractor tenders on the basis of the bills of quantities, the bills of Quantities are measured and provided by the owner’s QS in the Tender Documents for the contractor’s pricing in the Tender Preparation. | Medium (pay according to actual quantities constructed) | Medium (pay according to actual quantities constructed) Upon completion, works are remeasured according to as-built drawings and payments to contractor is according to the re measured drawings. Cost Plus | Contractor is paid for cost, design, material and a profit. | Lowest (Contractor is assured that his cost would be paid, plus a profit) | Highest (Owner has to pay the incurred cost of the Contractor for the project plus a profit), might have cost overrun