Planning and Management Tenders – Binders Under Regulation 5a

On July 1st, 2009, regulation 5a of the Tenders Obligation Act came into force, defining three different binders with planners: 
  1. A binder of up to 1.5 million NIS would be conducted by selecting from the planners' reservoir, by parameters of quality only.
  2. A binder of 1.5 to 3 million NIS, or an undefined project, will be conducted by way of 'Competitive Call' for offers (a closed tender), giving the quality component 80% and the price component 20% of the consideration.
  3. A binder of 3 million NIS or more will be conducted by way of a public tender, giving the quality component 80% and the price component 20% of the consideration.

It was further decided that offers that exceed the median by 15% or more (where at least 5 offers were submitted), will be rejected, provided however that half of the valid offers submitted in that tender were not rejected.

As the leader of change in the tender system, who has gone to great lengths to facilitate this regulation, IOCEA views this resolution (selection based on 80% quality and 20% price considerations) as essential to the public system in Israel. The IOCEA therefore continue its campaign against such tenders in planning, management and supervision that do not comply with the principles as set in regulation 5a.

At the same time, IOCEA is working towards abolition of the requirement to present guarantees in government tenders and reduce the rates of execution guarantees. After long negotiations with the Ministry of Finance, the Accountant General has issued a temporary order in 2009, according to which the tender guarantee of up to 300,000 NIS projects should be abolished, and execution guarantees reduced to a total of 5% of the binder 

However, IOCEA is not yet satisfied and shall continue to act with determination until such time as a total abolition of tender guarantees has been achieved, as well as a full adherence of the temporary order according to regulation 5a.