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| Glossary of Terms Often Used Within Public Sector Procurement |
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Accreditation
External recognition that you meet certain standards. This can be general (for example, your quality assurance system if you have one), or specific to a particular activity such as aspects of health care.
Added Value
Features and benefits that you offer which exceed the specification for the contract.
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Balanced Scorecard
A framework which translates a company's vision and strategy into a coherent set of performance measures. A balanced business scorecard helps businesses evaluate how well they meet their strategic objectives.
Benchmarking
A continuous exercise of measurement of products, services and work processes, against those recognised as leaders.
Bid
A formal proposal to supply goods or services at a specified price, usually describing how the contract requirements will be met.
Business Case
A document setting out the information a manager needs before deciding whether to support a proposed project, before significant resources are committed to its development. The core of the business case is an assessment of the costs and benefits of proceeding with a project. |
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Charitable
• In England and Wales, charitable purposes are defined as being:
• The relief of financial hardship
• The advancement of education
• The advancement of religion
• Certain other purposes for the benefit of the community.
Co-Financing Organisation
A public sector intermediary body approved to act on behalf of a government office.
Common Procurement Vocabulary (Codes) - CPV
Codes that are used throughout the EU to describe goods or services. CPV codes are mandatory and are attributed by public procurement specialists. Sometimes they do not describe goods or services how suppliers might.
Contract
A binding agreement to perform a certain service or provide a certain product in exchange for valuable consideration, usually money.
Contract Notice
A notice published in OJEU, announcing a public sector organisations intention to let a contract for specific goods or services, and explaining the type of procurement process to be used.
Contracting Party
The leading organisations that have entered into contractual obligations. If you have a contract with a public sector organisation and you have sub-contracted some of the work to others, you are the contracting party, the sub-contractors are not.
Contractor
Someone (a person or entity) who enters into a binding agreement to perform a certain service or provide a certain product in exchange for valuable consideration, usually money.
Costs
The money spent on resources to deliver the service.
e-Auction A tendering process where bidders go online and bid against each other live to offer the lowest price. Bidders will already have submitted technical details of their offer and will only be allowed to bid a price if their offer has met all the requirements.
Consortia
This is the term commonly used for groups of businesses or organisations, joining together to bid for and deliver larger contracts. See Working with other businesses.
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Efficiency
• Getting more out of your resources, could be doing:
• More with the same resources
• More with fewer resources
• The same with fewer resources
Equality
Equality is about making sure people are treated fairly and given fair chances. Equality is not about treating everyone in the same way, but it recognises that their needs are met in different ways.
E-Tendering
Electronic system used to view and submit tenders. Public sector organisations use e-tendering systems, usually the same system such as the North East Purchasing Organisation (NEPO).
European Union Regulations (EU Regs)
There are rules and regulations set by the European Union with regard to procurement for public sector organisations – these rules and regulations are set to protect suppliers and must always be followed by all public sector organisations.
Evaluation
The process of assessing each bidders tender so as to be able to select the best option suitable to the requirements of the contract. |
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Feedback
Discussion with a pubic sector organisation to find the reasons for success or failure of a tender so as to learn how to respond effectively in future.
Framework Agreement
An arrangement where a purchaser selects suppliers and fixes terms and prices for a period in advance (often 3 years), and then calls on the suppliers to deliver as and when required. There is never a guarantee of work even if you are part of a framework agreement.
Full Cost Recovery
Covering all the costs of providing a service, including a suitable proportion of overhead costs.
Grant Money provided by a public sector organisation to support a particular activity. Grants do not cover the entire cost of the activity. There will usually be conditions attached to the grant but it is important to understand a grant is NOT a Contract. |
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Invitation to Tender (ITT)
A formal communication from a public sector organisation to a supplier inviting it to submit a tender. The ITT will usually also include a specification for the contract, instructions for submitting the tender, and the terms and conditions, which will govern the contract once it is active. |
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Local Multiplier 3 (LM3)
Local multiplier 3 (often just referred to as LM3), is a benchmarking tool public sector organisations can use to measure the impact of their spend within the local economy. LM3 can be used within all businesses and organisations as a benchmarking tool.
Lot
Some contracts are divided into a number of parcels of work (called ‘lots’) and suppliers are invited to state whether they are bidding for the whole contract or just parts of it.
Most Economical Advantageous Tender (MEAT) This speaks for itself – in terms of elements such as price, delivery, date, quality, technical support and technical merit. |
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OJEU (Official Journal of the European Union)
The Official Journal of the European Union, where all contract notices must be published for tenders that fall within the European procurement laws.
Overheads
The indirect costs incurred in running a business. These include rent and rates, marketing and publicity, administrative and financial costs. |
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Partnership
A cooperative relationship between people or groups who agree to share responsibility for achieving some specific goal.
Performance
Delivery of goods or services, judged against the standard specified in a contract.
Prior Information Notice (PIN)
This gives advance notice that a contract may be advertised at some point – perhaps later in the year.
Pre-Qualification Questionnaire (PQQ)
A questionnaire used by public sector organisations to check the suitability of suppliers and shortlist the ones to be invited to tender.
Procurement
The process of buying goods and services.
Procurement Card
Like a credit or debit card, but for organisations rather than individuals. It allows purchasers to order and pay for goods and services in the same way.
Public Sector Organisation
A public sector organisation provides or manages public sector services for government.
Purchasing
The buying of goods and services. |
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Quality
Fitness for purpose when judged against the standards specified in the contract.
Quotation
A less formal written offer to supply goods or services, with the supplier offering the price. This is often used when considering lower value public sector procurement. |
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Request for Tender
Same as invitation to tender.
Resources
People, equipment, facilities, funding, or anything else required for the completion of an activity.
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Selection Criteria
The factors that a public sector organisation will take into account when deciding which tender to accept. Usually some factors will count for more than others.
Service Level Agreement (SLA)
Like a contract, but often less formal, and not normally binding in law. Often used between 2 public sector organisations, or between 2 different departments of the same public sector organisation. A local authority may have SLA’s set up by the computer department to provide computers and maintenance to all other departments within the whole authority.
Specification
A description of the essential technical requirements for goods or services to be delivered under a contract, including the method for checking that the requirements have been met.
Value for Money Public sector organisations strive to achieve ‘value for money’ and this is not necessarily the lowest price. |
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