Consideration should be given to simplifying the bid evaluation process by requiring bidders to submit their bids in two parts: a technical bid and an economic bid, adopting the following two-stage process20:
• Determine whether bids are conforming and meet minimum acceptable service requirements.
• Of the bids that pass the test in (a), select the cheapest.
While the fact that this approach does not encourage bidders to offer a higher service level than what is demanded in the tender documents, there remains the question as to why taxpayers should pay for a higher standard than was deemed appropriate. The best approach will depend on the specific project. In some cases, it may be beneficial to pay more for a solution that exceeds the bare minimum.
Where the Project Brief indicated to bidders that the government will also consider higher or alternative service levels, then it may be necessary to evaluate bids on a multi-criteria basis. But care needs to be taken to avoid biases and double counting.
Biases can be avoided by measuring all criteria by a common denominator such as dollars.
| Example: If one bid just meets the minimum requirements but another bid offers an enhanced service at a higher price, then an acceptable methodology would be to measure the value of the expected service levels in dollar terms and compare the two bids in terms of the net present value of each. If service enhancements will be considered, then the project brief should set out how the value of services will be measured. |
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20 This is standard practice in Chile.