Procurement policy

1. Introduction

1.1 The University has a devolved procurement structure and this document is intended to give clear guidance to staff in schools/colleges and professional services who are engaged in procurement/buying activities.

1.2 All University non-pay expenditure is covered by this policy. It is essential that this policy is followed when committing University funds. These procurement procedures must be followed by all staff and any departure from these rules will result in disciplinary action. It is the responsibility of all budget holders to draw these regulations to the attention of all staff likely to become involved with the procurement of goods, services or works.

1.3 Failure to observe this policy may lead to disciplinary action being taken.

1.4 If further guidance is required staff should contact Strategic Procurement.

2. Applicable public procurement legislation

2.1 The rules for predominantly publicly funded organisations on purchasing goods, services and works in England, Wales and Northern Ireland are set out in the Public Contract Regulations 2015.

2.2 Now that the United Kingdom has left the European Union, it should be noted that, following the end of the implementation period at 23:00 GMT on 31 December 2020, there will be amendments made to this legislation. The University intends to revisit this guidance in due course to take account of any changes in public procurement law or policy following the end of the implementation period.

3. Value for money (VFM)

3.1 The Office for Students (OfS) is the independent regulator of higher education in England, and require universities to demonstrate that all students from all backgrounds receive value for money. The OfS also seek to ensure value for money for taxpayers.

3.2 The OfS has issued a VFM strategy for 2019 to 2021, to which university procurement is relevant.

3.3 The University provides an annual VFM statement to demonstrate commitment to these principles, which contains a section on procurement.

3.4 The procurement section contains detail on all activity carried out by the University that provides cashable, non-cashable and process savings on non-pay spend, and as such all University staff involved in commissioning non-pay spend are responsible for reporting any savings to the procurement department:

Cashable savings

• These are savings on items that will directly affect the bottom line year-on-year.

Non-cashable savings

• These are savings on items that would have affected the bottom line had procurement not intervened. These will largely include savings on items such as one-off projects and tenders.

Process savings

• These are savings that may directly affect the bottom line as resources have been released to add value. These are only reportable if they can be quantified.

4. Ethics

4.1 Anyone responsible for any procurement activity must comply with:

4.1.1 The University’s ethical policy set out in the financial regulations (section 2.1), The financial regulations can be found on our policies and regulations page.

4.1.2 The University’s regulations relating to declarations of interest, which are set out in the financial regulations (section 2.3) and the declarations of interest policy.

4.1.3 The Chartered Institute of Purchasing and Supply (CIPS) Professional Code of Ethics which can be found on the CIPS website.

5. Modern slavery

5.1 The University has a zero-tolerance approach to modern slavery and is committed to acting ethically and with controls to take steps to ensure modern slavery is not taking place anywhere in its own business or in any of its supply chains.

5.2 For further information relating to our Modern Slavery Act 2015 compliant statement can be found on our Policies & Regulations page.

5.3 Staff must look out for signs of modern slavery in our supply chain, particularly in risky commodity area, and challenge or report concerns. Staff may notice irregularities that suggest modern slavery. Staff must report all suspicions or observations to their director who will investigate further. For more information visit the Modern Slavery Helpline website.

5.4 Wherever applicable, the University will seek to include, in its tendering activity and contracts, specific obligations to comply with applicable laws relevant to the nature of the service including and not limited to the Modern Slavery Act 2015, Bribery Act 2010, General Data Protection Regulation (GDPR), Health & Safety at Work Act 1974, The Equality Act 2010. We expect that our suppliers will hold their own suppliers to the same standard.

6. Strategic Procurement purpose and objectives

6.1 The purpose of the Strategic Procurement is to:

• 'Establish an efficient, effective and coherent structure of informed procurement at UWL'

6.2 The following are the objectives of Strategic Procurement:

6.2.1 Objective 1: Provide optimum value for money (VFM) for all aspects of University expenditure through sourcing, supply, performance monitoring and embedding a VFM ethos in everyday management decision making.

6.2.2 Objective 2: Introduce and embed category management for all strategic non-pay expenditure. Analyse non staff expenditure and apply appropriate procurement strategies to deliver VFM and reduce commercial risk.

6.2.3 Objective 3: Improve best practice awareness and use throughout the University at all levels of expenditure to achieve optimum VFM by providing guidance to devolved procurement staff on:

• Relevant procurement information on policy and EU directives/Public Contract Regulations
• Consortium, Crown Commercial Service (CCS) and other collaborative procurement opportunities
• The latest procurement techniques and best practice in the procurement field
• Contract performance monitoring to support and deliver optimum VFM

6.2.4 Objective 4: Encourage and promote co-operation and communication between devolved procurement expertise and Strategic Procurement in order to better influence total University expenditure.

6.2.5 Objective 5: Improve, embed and monitor overall procurement performance. Build an ethos of continuous improvement throughout the procurement infrastructure to support and deliver continued savings where possible.

6.2.6 Objective 6: Promote collaboration by pursuing and developing co-operative relationships between the University and external procurement stakeholder bodies such as SUPC (Southern Universities Purchasing Consortium), LUPC (London Universities Purchasing Consortium), Crown Commercial Service (CSS) and other public and non-public sector bodies.

6.2.7 Objective 7: Embed sound ethical, social and environmental policies within the procurement function at both a strategic and devolved level.

6.2.8 Objective 8: To monitor and reduce any risk associated with external expenditure and the appointment of third-party suppliers engaged with the delivery of services and supply of goods i.e. to ensure the safe and uninterrupted delivery of the educational requirement of the organisation. 

7. Best procurement practice

7.1 Strategic Procurement should be consulted with to obtain advice and assistance at an early stage when procurements are being considered. This is to ensure that advantage is taken of any favourable supplier agreements or in-house expertise (subject to the spend thresholds).

7.2 Where contracts or agreements are in existence with suppliers, these should be used in the first instance.

7.3 All procurements are made at the most advantageous whole life cost consistent with their specifications which must include technical standards, quality and reliability. Whole life costing includes all related costs to be taken into consideration for example annual maintenance, consumables, running costs and costs/profits of disposal, not just the initial cost price of the item. For a full definition of life-cycle costing as defined within the Public Contract visit the government website. 

7.4 Fair, competitive processes for quotations and tenders are employed in evaluating VFM. The total cost must include all whole life costs for example, installation, commissioning, servicing or maintenance for the life of the contract, as per point 7.3.

7.5 Where University or Consortia, CCS and other public/non-public sector framework agreements are available and these have been awarded by competitive methods then the agreements can be used. A procurement framework is an agreement put in place with a provider or range of providers that enables the University to place orders for services without running lengthy full tendering exercises. Budget holders must consult Strategic Procurement prior to using any framework.

7.6 Contracts awarded by individual departments must be notified to Strategic Procurement so that they can be made available for use by all other areas of the University. Copies of contract to be sent to Strategic Procurement.

7.7 Any details of supplier agreements with the University should never disclosed to third parties without prior consultations with Strategic Procurement or legal services as appropriate.

7.8 Goods and services must be procured with high ethical standard and focussed on social, economic and environmental considerations by applying principles of sustainable procurement.

8. University procurement thresholds

8.1 Advice must be sought from Strategic Procurement for any procurement above £24,999 before any preliminary discussions are entered into with a supplier.

8.2 Table A - Thresholds for obtaining quotes and tenders:

• Up to £4,999: One written or verbal quotation
• £5,000 to £24,999: At least two written quotations
• £25,000 to £49,999: Quotation exercise to be managed by Strategic Procurement
• Over £50,000: Tender exercise managed by Strategic Procurement

1. A quotation is a straightforward price and delivery exercise.
2. These are total amounts, even if the supply will run over more than one financial year.
3. The thresholds represent minimum requirements, but departments may opt for more stringent limits if this will optimise VFM or help address inherent risk in contract no matter their value.
4. Under no circumstances should procurements be split to fall below a particular threshold.
5. Above £24,999 Strategic Procurement should be consulted as the Public Contracts Regulations 2015 may apply and guidance must be sought before any contact with suppliers.

8.3 A tender is a formal detailed exercise of obtaining sealed bids for higher value, higher specification and/or special terms and conditions against an appropriate specification.

8.4 The University is subject to EU Directives/ Public Contracts Regulations 2015 which require purchases above certain thresholds to be put out to tender in accordance with the provisions of the Official Journal of the European Union (OJEU). EU Directives/Public Contracts Regulations 2015 apply to most higher education institutions and cover works, services and supplies. The Regulations apply whether it is intended to procure goods by purchase, lease, rental or hire purchase (with or without an option to buy). The thresholds relate to the cost of the item or service plus maintenance and any other support services that will be given by the supplier for a fee, over the life of the contract. The current thresholds (not including VAT) under the EU Directives/Public Contracts Regulations 2015 are:

• £189,330 for services and supplies (in force from 1 Jan 2020)
• £4,733,252 for works (in force from 1 Jan 2020)

Read the government policy document for more information.

8.5 There are minimum time requirements in completing procurement processes that fall under the EU directives/Public Contract Regulations. Read the government policy document for more information.

8.6 All records of the EU Directives/Public Contract Regulations tendering process must be adequately documented and the evaluation process must be transparent for monitoring value for money and audit purposes. All documents must be available for the period of the agreement, plus any extension period. It is the responsibility of the office (i.e. Strategic Procurement or individual departments devolved procurement functions office) that conducts any in scope tendering process to ensure all records are available and comply with EU directives/ Public Contract Regulation. Visit the official government website or Regulation 84 website for more information.

8.7 Non-compliance with EU Directives/Public Contracts Regulations 2015 can bring heavy penalties if an aggrieved supplier takes the University to court, under the Remedies of the EU Directives/Public Contracts Regulations 2015 which has the power to grant an injunction or to award damages.

9. Devolved procurement

9.1 Where the agreement is to be used by more than one department and the agreement is not negotiated by Strategic Procurement, the main devolved procurer should:

1. Consider the expenditure of other user departments
2. Inform the Strategic Procurement of the agreement who will continue to negotiate on behalf of the University

9.2 Fragmentation of ordering amongst a wide range of suppliers for similar goods/supplies reduces:

1. The scope for competitive negotiations
2. The scope for improving product quality
3. Supply chain management capabilities and the effectiveness of category management

Therefore, devolved procurement must not be fragmented.

9.3 This will produce benefits in negotiating the most competitive terms, achieve VFM and simplify arrangements for maintenance, service and repair at an organisational level.

9.4 Strategic Procurement will centrally negotiate and facilitate tender processes to deliver supplier agreements that achieve optimum value for the University, as per procurement thresholds.

10. Purchase orders

10.1 The University is committed to third parties once a purchase order has been raised and issued to the third party.

10.2 All purchases of goods, services and works can only be made by the issue of a properly authorised purchase order or by purchasing using one of the Universities Procurement Cards (see section 12 below).

10.3 The purchase order must be raised and authorised before the commitment is made with the supplier. Under no circumstances should the raising and approval of the purchase order be left until receipt of invoice.

10.4 Purchase orders should be raised using the University’s Parabilis system. The Finance department maintain the work flows so that orders are sent electronically to the budget holder or his/her named nominee for authorisation and then routed for approval in accordance with the 7.2.9 of the financial regulations available on our Policies & Regulations page.

11. Delegation of authority to approve expenditure

11.1 The Scheme of Delegations sets out the monetary levels for purchase order approvals and lists the budget holders appointed by the Vice-Chancellor. The authority levels are as below:

Monetary limits (excluding VAT) and delegation

• Up to £4,999: Budget holder or nominated Delegate
• £5,000 to £250,000: Budget holder + Chief Financial Officer or Deputy Chief Financial Officer
• £250,001 to £1m: Vice-Chancellor + budget holder + Chief Financial Officer or Deputy Chief Financial Officer
• Over £1m: Finance Committee

11.2 During planned absences such as holidays budget holders may delegate their full authority to a member of their staff. Notification should be given in writing to the Chief Financial Officer who will ensure that Parabilis is updated accordingly.

11.3 A purchase order can only be raised where the supplier has been set up on Parabilis. 

11.4 Once authorised, purchase orders will be sent electronically to suppliers (or can be printed and sent dependent on the supplier’s level of integration with Parabilis). The purchase order template refers to the University’s standard terms and conditions of trade, which are prepared by Strategic Procurement and are on our policies and regulations page.

11.5 There must be no artificial fragmentation of orders whereby authorisation can be given at a lower level than is appropriate. Therefore similar purchases for similar items must be added together to show the value of the category of spend.

11.6 Payment terms, such as early payment settlement, are not to be agreed under any other terms and conditions, except with the approval of the Chief Financial Officer. 

11.7 All staff who are authorised to approve the purchase of goods, services and works on behalf of the University must make every effort to ensure that value for money is obtained. They may be called upon to demonstrate that this requirement has been met.

11.8 All orders must be placed using University preferred suppliers and where they exist centrally negotiated contracts by Strategic Procurement. As a charity the University is eligible for zero rating or VAT exemption on several of its supplies. Using the University’s preferred suppliers ensures that we are correctly invoiced, and VAT is not unnecessarily charged.

11.9 Budget holders and their nominees are not authorised to commit the University to expenditure in excess of the approved budgets. The purchase of goods, services or works to a level in excess of the approved budget requires the approval of the Chief Financial Officer.

12. Procurement cards

12.1 Procurement cards enable staff to make purchases against a card which has been issued for their use. The cards have restrictions relating to types of purchase and monetary limits; these vary between card holders.

12.2 Procurement cards are issued with the approval of the Chief Financial Officer to specific staff for the purchase of low value items. 

12.3 Budget holders will agree the restrictions on the cards with Strategic Procurement.

12.4 Cardholders are required to sign an agreement for use of the cards which specifies (inter alia):

1. Cardholders are responsible for keeping an online transaction log and for sending the receipts to the Finance department. Cardholders will use the cards solely for the purpose of University expenditure and under no circumstances for personal expenditure. Expenditure must be made within approved budgets.

12.5 The full details relating to procurement card procedures are on the website.

13. Category code selection

13.1 United Nations Standard Products and Services Codes (UNSPSC) have been introduced to all areas of non-pay spend to enable the University to code effectively all non-pay expenditure.

13.2 It is therefore important that UNSPSC codes are accurately selected in Parabilis against non-pay expenditure to reflect the appropriate category of spend. Access to, and analysis of, accurate non-pay spend will deliver improved value for money.

14. Payment of supplier invoices

14.1 As set out in the University’s terms and conditions of business:

1. All invoices should be sent to UniWestLondon@proactiscapture.com. Staff who liaise with suppliers should ensure that the suppliers are aware of this;
2. Payment of invoices will be within 30 days of receipt of a valid invoice by the Finance Department;
3. Suppliers are required to put the University order number on their invoices. Failure to do this may result in delayed payment.

14.2 All processing of invoices submitted for over threshold contract should comply with the Public Contract Regulations 2015.

14.3 The Finance department are responsible for the payment of suppliers by BACS and for notifying them of the payment by email.

14.4 Supplier payments are no longer made by cheque.

15. Conditions of contract

15.1 The University’s standard terms and conditions for purchasing are on the University’s website.

15.2 These terms and conditions apply to all procurements unless otherwise agreed formally in writing by the University Secretary and/or the Head of Legal Services.

15.3 There are model contracts available from Strategic Procurement. Please see the Head of Legal Services for any modifications to the standard terms and conditions for a particular supplier contract.

15.4 Procurers should:

1. Carefully read suppliers conditions of contract and if need be seek advice from Strategic Procurement or Head of Legal Services;
2. Ensure all health and safety regulations are fully complied with on a procurement; for assistance and advice contact the Health and Safety Officer.

16. Single source contracts

16.1 Where goods and services are only available from a single source or limited number of suppliers or from an appointed agent where manufacturers control the pricing structure, competition should be actively encouraged by inviting potential suppliers to enter the market by adjusting specifications where possible. Guidance on when this may be appropriate is set out in the Public Contract Regulations 2015.

16.2 Where it is not possible to invite potential suppliers to enter the market, it may be appropriate to negotiate directly with the single source supplier or limited number of suppliers without holding a formal tender exercise, but only where:

1. The works, services or supplies can only be performed by a particular supplier because competition is absent for technical reasons; and
2. no reasonable alternative or substitute exists, and the absence of competition is not because of an artificial narrowing of competition. 

16.3 It is at the discretion of the Chief Financial Officer that single source contracts will be awarded.

17. Contract management 

17.1 Procurers should ensure that service levels are clearly stated in all quotation and tender documents and are agreed with all suppliers, contractors and service providers.

17.2 Contract owners should ensure routine and sufficiently regular contract review meetings are held to ensure the agreed service level agreements (SLAs) and key performance indicators (KPIs) have been met.

17.3 Procurers should ensure that sufficient mechanisms are in place in the event of service levels/key performance indicators not being met such as service credits or contingency plans for non-delivery.

18. Data protection

18.1 Procurers should ensure that suppliers, contractors and providers adhere to the University’s data protection policy, in particular section 17, which can be found on our policies and regulations page.

18.2 It is the responsibility of the contract owner to ensure that the appropriate contractual terms are in place, that appropriate due diligence is performed and that the necessary contractual actions are carried out to reduce the risk of regulatory non-compliance.