Small firms no longer need ‘experience’ for public tenders

A few eyebrows have been raised in business circles over a government decision to eliminate the use of "experience" as part of the selection criteria in the procurement for government contracts valued below €500,000.

Elsewhere, budding small and medium enterprises have welcomed the decision: no more automatic elimination for small firms seeking lucrative public tenders issued by the government.

"It cancels out the leverage previously exerted by established firms, who not only had their experience as an advantage, but also their experience in tendering and putting forward competitive pricing," an official from a business association told MaltaToday.

Hundreds of millions in taxpayers' money is annually dispensed in public competitive tenders, with government work representing a crucial source of income for several business firms.

But tendering is a process that requires scrupulous attention to detail and non-refundable bid bonds to be invited to tender.

Now, a government circular has announced that in a bid to "increase opportunities in the public procurement market" to new and emerging companies, the government has eliminated the use of "experience" as part of the selection criteria in the procurement process.

"Experience is only one of the criteria used in the evaluation process as evidence of technical capacity of economic operators. In fact, it is being brought to the attention of all contracting authorities that there exist a number of other criteria that may be utilised to ascertain the technical capacity of economic operators," director-general of contracts Anthony Cachia said.

Under the new rules, evidence of a tenderer's technical abilities may be furnished by one or more criteria, amongst them quality of work, technical facilities, production capacity, educational and professional qualifications, and environmental management measures.

Earlier in 2013, SMEs were exempted from presenting prohibitive bid bonds when submitting an offer for government tenders below €120,000. Additionally, performance guarantee is now needed for tenders whose value does not exceed €10,000. The new conditions came into force on 1 October.