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►  Problem Statement

Consulting town and regional planners are often faced with the daunting task of submitting a project proposal and cost estimate to a local authority or other government institution based on a tender invitation which is no longer than a few sentences on a fax sheet.  A typical invitation to submit project proposals would read as follows:

►  Comparative Problems

The result of a project call such as is described above is usually that the client receives a number of totally divergent proposals with cost estimates which range over the entire spectrum whilst the consultants are left to their own devices to determine the format of the proposal and the amount of effort required to make the submission.  This usually places the client in a position where “apples cannot be compared with apples” and, as a result a very unfair decision is usually taken regarding the cheapest cost estimate.  This, notwithstanding the fact that the various proposals usually differ substantially in nature and content. 

The analogy that can be drawn in this regard is where a client invites a number of travel agents to submit proposals and cost estimates for an extended vacation.  The type, duration, budget and dates are not specified and the various travel agents are left to their own devices to submit travel packages and cost estimates which they believe will suit the client’s requirements.

The client is finally faced with a range of options at vastly different prices.  The proposals cannot be compared in a sensible manner nor can the cost estimate relating to each.  To merely choose the cheapest or most reasonably priced proposal will not necessarily suit the clients’ requirements.  The same scenario applies to the appointment of consultants where the requirements of the client are not spelled out in detail.

► Purpose of this Report

The need for a properly formulated professional brief to eliminate the problems as described above is therefore of utmost importance to both the client and consultant.  This document deals briefly with certain proposals prepared by the ACTRP which may be used fruitfully by metropolitan or local authorities, government and parastatal organisations alike.  It also represents the position of the ACTRP regarding this important issue.

►  Levelling the Playing Field

In the first instance, when a client decides to invite project proposals from consultants for a project such as an integrated development plan, strategic framework plan or any other service required, it is imperative that a proper professional brief be formulated to level the playing field for all those invited to submit proposals.  In this regard it is proposed that, where the scale of the project permits, the client should appoint an independent consultant to investigate and write the professional brief.  The professional brief should, under normal circumstances, define at least the following in no uncertain terms:

Where local authorities or other government organisations do not have inhouse expertise regarding these matters, the ACTRP is willing to prepare a manual or guiding principles to assist such organisations.

► Author of the Brief

In the event of an independent consultant being tasked to compile the professional brief, a limited sum of money (say R5 000 - R10 000) may be made available for this purpose so as to ensure a professional product which will be clearly understood by all participating consultants.  In addition such independent consultant may also be required to arrange for the tender invitation by means of press statements or direct invitation to a select panel of consultants which are regarded as suitably qualified and experienced for the intended task.

The independent consultant can also assist in the evaluation of the various proposals to the point where a recommendation is made to the client regarding the appointment of the selected consultant.  Clearly, the independent consultant will be disqualified from tendering for the project should such consultant be involved to this extent.

In the event of the project not requiring the appointment of an independent consultant to write the professional brief, the client should consider allocating such responsibility to a senior representative from within its organisation suitably qualified to prepare the professional brief along the guidelines explained above.

► Alternative Options

A number of alternative tender procedures can be adopted depending on the nature and extent of the proposed project.  The following are the more commonly used procedures throughout the world:

·      Alternative 1:

Two Envelope System

Once the professional brief is clearly defined as set out in the previous section, the client must decide to invite selected consultants or to publish a general advertisement in appropriate magazines or the press inviting tender submissions.  The latter is generally preferred by the ACTRP.

A part of the brief should be that prospective consultants submit two envelopes, one containing the actual project proposal, curriculum vitae and time schedule whilst the second envelope contains only the cost estimate as required in the professional brief.  On receipt of the various proposals and after the closure of a specified expiry date, the first envelopes of all the submissions are opened to compare the project proposals only.

The client, and in certain instances the independent consultant, then evaluates the various submissions and finally selects one or two which appear to suit the client's requirements in the most appropriate manner.  An evaluation sheet and points scoring system should be used where possible to standardise the evaluation procedure.  Only at this stage does the client open the second envelopes of those consultants on the short list to evaluate the short listed cost estimates. 

Where two or more consultants are placed on the short list, such consultants should be invited to independent interviews to further discuss the cost estimates before a final decision is taken.  This procedure eliminates the possibility of selecting a consultant solely on the basis of cost whilst the content of the project proposal and approach to the problem are neglected.

·      Alternative 2:

Fixed cost tender

In this scenario the client has a fixed budget for a specific project.  The professional brief is drawn up as discussed in the previous section, but the tender invitation specifies that a certain amount is available for such project and that prospective consultants are invited to submit proposals in accordance with the professional brief.

In this scenario the consultant does not waste time in calculating the estimated cost as the invitation is limited to submitting a proposal within the guidelines of the overall professional brief in which the consultant has to indicate how the available funds of the client can be best appropriated.  In other words, the consultant will indicate what the client is likely to receive for the amount which the client is willing to pay.

In this instance the two envelope scenario is obviously not required and the client will have to weigh the pros and cons of each p project proposal to select the preferred consultant.  The initiative taken by a specific consultant and the approach to the project will be the only important factors to consider in this scenario.

This proposal eliminates the possibility of consultants wasting time on doing detailed cost estimates only to find that when they appear on the short list the client was aware, all along, that a limited amount was available for the project and that the project will have to be completed at such cost - notwithstanding the nature and extent of the project proposal.  In this alternative it is important for the client to give a clear indication of what is included and what is excluded from the available funding.  Matters such as disbursements and VAT should be explained appropriately.

·      Alternative : 3

Pre paid project proposals

Under certain circumstances the peculiar nature of a project may dictate that only a select group of consultants may be regarded as appropriately qualified to undertake such a project in view of their specific experience and expertise.  In such instance it would not serve any sensible purpose to embark on a widely publicised tender procedure.

Where the client requires that a select group of consultants should be invited to submit project proposals for a specialised project, and where the client is aware of the existence of such consultants and their work on projects of similar nature, the client should be willing to pay an appropriate sum to invited consultants to cover preparation and presentation expenses.

Specialised projects usually require specialised presentations and project proposals which, in turn, require specialised and expensive materials and the dedicated involvement of specialised experts.  The professional brief or call for project proposals extended to a select group of consultants should, under the circumstances, be very carefully formulated and the exact format and nature of presentations or project proposals required should be specified in detailed form.

In such instances, a fixed amount per consultant should be provided by the client (say between R5 000 and R10 000) to enable such consultants to prepare proper project proposals.

This alternative can obviously be applied in conjunction with either the Two Envelope System explained under Alternative 1 or the Fixed Cost Tender explained under Alternative 2.  The principles which apply to the other tender alternatives regarding matters such as professional fees, etc. remain unchanged

►  General Invitation

As a general point of departure and in the interest of transparent governance, the ACTRP proposes that where the magnitude of the project permits, the tender invitation be published as widely as possible such that the largest possible number of prospective consultants be reached.  In this regard the ACTRP can be of assistance in supplying the membership lists to those parties requiring information on town and regional planning consultants.  The ACTRP can also act as point of contact to distribute the tender invitation to its members.

►Locational Preference

It has become the norm for authorities to favour the appointment of consultants with offices located within the areas of jurisdiction of such authorities - be it at provincial, metropolitan or local level.  This, in turn, has resulted in certain consultants establishing small offices in areas without a substantial presence, merely to be seen to be present in a particular area and to qualify for possible appointments.  It is the opinion of the ACTRP that this situation is detrimental to both the relevant authorities and the affected consultants.

The ACTRP's position on this matter is that, although we support the principle of favouring local consultants and thereby stimulating the local economy, this should not be enforced at the cost of expert advice from specialized consultants with appropriate experience in certain matters.  Where local consultants don't have the expertise, infrastructure or experience to deal with a particular project, outside consultants should be assigned to co-ordinate the project in collaboration with a local consultant.  The local consultant will still share in the financial benefit while gaining valuable experience and training in the process of doing so.

► Paying Up

Where a tender invitation is widely publicised and where the scale of the project permits, it is proposed that prospective consultants be required to pay for the tender documentation.  Such payment can be in the form of a deposit which may be refunded to those consultants who submit project proposals before the specified expiry date.  This eliminates the possibility of a wide range of consultants uplifting tender documentation without serious intent of submitting a project proposal.

By placing a price on the tender documentation the client may recover a certain component of the cost of the preparation thereof.  As a guideline it is proposed that tender documentation be issued at prices varying between say R200 and R1 000 per set.  This will depend on the nature and extent of the proposed project and the level of detail of the professional brief.  Where a limited number of consultants are invited to tender, the client should not request payment for the tender documentation.

Where possible it is proposed that the Professional Scale of Fees as published by the South African Council for Town and Regional Planners under Act 19 of 1984, be specified as the framework within which professional fee proposals should be submitted by participating town and regional planning consultants. 

In the event of the scale of fees not catering for a specific project proposal, it is recommended that consultants be required to submit a time and cost estimate relating to each individual step in the process as envisaged in the professional brief.  This will enable the client to sensibly compare the short list cost estimates prior to selecting the preferred consultant.

When a final decision is taken regarding the appointment of the selected consultant, this information should be communicated to all the other unsuccessful participants.  The reasons for the final selection and the agreed fee for the appointment should also be confirmed in writing.  Unsuccessful tenderers should also be informed of the total list of tenderers who took part and how the individual proposals were evaluated.  This will enable participants to compare their relative strengths and weaknesses and will ensure ever improving levels of quality of project proposals submitted by such consultants in future.  Documentation submitted by unsuccessful tenderers should be returned.

A letter of appointment addressed to the selected consultant should only serve the purpose of confirming the final decision of the client.  However, a detailed agreement should also be entered into between the parties to confirm responsibilities, time frames, invoicing procedures and the nature and format of the required deliverables.

The issue of successors in title, where a consulting firm dissolves or breaks up, should also be addressed and at least one principal should be nominated to accept personal and professional responsibility for the completion of the project.  The pro forma appointment agreement of the ACTRP can be made available for this purpose.

In response to the Government's policy on affirmative action, the ACTRP proposes that where consulting firms or companies are too small to accommodate affirmative action appointments at senior partner level, it be required of such consultants to involve an independent emerging consultant as part of the professional team when the project proposal is submitted on invitation by the client.

In the event of such consultant being successful in the tender it should be made a condition of appointment that a specific written agreement be entered into with the emerging consultant to clearly define the responsibilities of all the parties and how the emerging consultants will benefit, both financially and in terms of experience, by participating in the project.

This proposal eliminates the possibility of so-called window dressing by consultants who suddenly indicate new partners and directors on letterheads where such affirmative action appointments are nothing more than names on paper with no direct benefits to the emerging consultant beyond financial gain in return for printing such consultant's name on the stationary of the relevant firm or company.  This proposal also ensures that smaller emerging consultants gain valuable experience in areas of the profession where they would normally not be involved in as a result of their inexperience and size.

The ACTRP expresses the hope that metropolitan and local authorities, government departments and other parastatal institutions will make use of these proposals in their endeavours to appoint town and regional planning consultants for an array of planning related projects where public funds are used.

The proposals put forward in this document will, in the opinion of the ACTRP, result in a fair and equitable system of evaluation and at the same time result in responsible and transparent allocation of public funds by the relevant officials involved.  The ACTRP is willing to participate in any matters related to the setting up of structures in the above regard and should additional information be required, the Secretariat may be contacted for assistance.

_________________________________________

Prepared by:

The Association of Consulting Town and

Regional Planners (North Region)

P O Box 36086

MENLO PARK

0102

Tel:   012 - 362 1741

Fax:  012 - 362 0983