Low Bid Selection of Construction Tenders
General
The purpose of this guide note is to provide guidance on the low bid selection of Department of
Planning, Transport and Infrastructure (DPTI) construction tenders.
A critical element of project delivery and achieving best value is selecting the most appropriate
contractor for the building project. There is general acceptance that those assessing
Government tenders and DPTI Building Management construction tenders in particular, need to
consider more than price alone if the most appropriate contractor is to be selected. For this
reason, DPTI includes consideration of contractor performance in all tender assessments
through the use of the DPTI Bulding and Construction Project Prequalification System
(Prequalification System) performance score. The performance score is included in the tender
evaluation process to recognise that:

the lowest priced conforming tender does not necessarily represent best value for money

critical project requirements may be better satisfied by contractors who demonstrate
superior performance.
DPTI will also consider other relevant matters as stated in the conditions of tendering.
This guide note applies to the evaluation of construction tenders on all DPTI building
construction contracts exceeding $150,000 in value where low bid selection has been
nominated in the tender documents.
Determining Criteria Weightings
An indication of the relative weighting of price and performance is published in the tender
documents to provide tenderers an understanding of the relative importance of evaluation
criteria.
Criterion 1 – Price
Where a traditional procurement method is used, generally a weighting of at least 80% is set.
Where a non-traditional procurement method is used, generally a weighting of at least 75% is
set.
Where fees only are tendered, generally a weighting of at least 70% is set.
Criterion 2 – Performance (Prequalification System score)
Generally ,appropriate weighting for the Prequalification System Performance Score is 10%
where the traditional procurement method is used, 15% where procurement is non-traditional
and 20% where a fee only is tendered. Where a short-listed or select group of tenderers only
are invited to tender, it is recommended that the use of performance as a criterion be weighted
less than 5% or preferrably removed completely from the evaluaiton criteria.
Below is a table indicating the DPTI standard approach to weightings. The project team will
agree all weightings prior to registration of interest or tender call. Significant deviation from the
DPTI standard weightings will require approval of the appropriate DPTI delegate.
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Low Bid Selection of Construction Tenders
Weightings Table
Criteria
Traditional
Non-traditional
Fee only
Price
90%
85%
80%
Performance
10%
15%
20%
100%
100%
100%
It is essential that sufficient explanation be provided to tenderers in regard to the evaluation
criteria to be used in the tender evaluation.
An indication of the relative weightings of price and performance criteria (as a range or an upper
limit, but not precisely) will be provided in the tender documents.
Evaluation of Tenders
Steps in the evaluation process are as follows.
Pre-tender
The DPTI Project Risk Manager convenes tender evaluation panel at which the manager will
provide an explanation of the method used to score the tender submissions and a general
overview of the scoring regime. The panel agrees by consensus the weightings for price and
performance criteria and incorporates relative weightings of criteria into the tender documents.
Tender Close

Building Management Contracts Management receives and schedules tenders.

DPTI Prequalification Registrar advises the tenderers’ DPTI Prequalification System
performance scores for the specified category.

DPTI inputs weightings and the performance scores into the Low Bid Selection Matrix and
provides matrix to members of the tender evaluation panel.
Alternate Bids

DPTI Project Risk Manager convenes the tender evaluation panel and reviews any
submitted alternatives and applies DPTI alternative assessment procedures.

Where an acceptable alternate bid provides a very significant variation in the tender sum
from the price benchmark, the alternate bid will be fully evaluated including conformity
with technical and contractual requirements in the tender documents, prior to progressing
the low bid selection process.

Where an acceptable alternate bid is such that there is no possibility that other tenders
will be judged to offer better value, then in these circumstances, DPTI reserves the right
not to continue with the subsequent steps of the low bid selection process.
Scoring to Determine Initially Preferred Tenderer
The tender evaluation panel inputs tender sums (revised to reflect acceptable alternatives) into
the Low Bid Selection Matrix to provide a final score for each tenderer out of 100.
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Low Bid Selection of Construction Tenders
Scoring Price
The DPTI Low Bid Selection Matrix includes built in formula that create a score for the price
criteria based on the lowest acceptable tender sum after the consideration and assessment of
alternate bids.
The tender price criteria formula compares the tender sum with the lowest acceptable tender
sum received. The lowest acceptable tender submitted always receives the highest score of
10.
Range of scores (0 to 10)
% greater than the lowest acceptable tender
sum
10 points
0%
8 points
10%
6 points
20%
4 points
40%
2 points
70%
0 points
100% or greater
The matrix then applies the agreed weighting for price to calculate the final weighted score for
price.
Scoring Performance
DPTI maintains a database in support of the DPTI Building and Construction Project
Prequalification System. The data base records the scores from performance reports submitted
by contractors at the time of application for registration as a prequalified contractor and
performance reports prepared by DPTI three months after handover of DPTI projects.
The database supports preparation of a report indicating the current average of performance
scores, out of 10, for all projects completed less than 4 years prior to the last date of application
for registration, and since, up to the date of tender close.
The score will only include projects for the specified category of the tendered project. If the
Prequalification System average score in the category is less than 5 (unsatisfactory) a score of
0 will be used in the matrix.
The matrix then applies the agreed weighting for performance to calculate the final weighted
score for performance.
Scoring Summary
The use of the DPTI Low Bid Selection Matrix ensures that there is accurate calculation and
recording of scores. This is crucial for an accountable and transparent tender evaluation
process.
The output from the matrix at the completion of the process is a weighted score (out of 100) for
each tender, which is the sum of the weighted scores for price and performance.
The highest score guides the tender evaluation panel as to the initially preferred tender.
Recommendation of Preferred Tenderer
The initially preferred tender is appraised for technical and contractual conformance, capacity
and any other relevant matters by the tender evaluation panel in conformance with the
evaluation procedures stated in the tender documents.
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Low Bid Selection of Construction Tenders
In the event that the initially preferred tender does not satisfactorily meet any requirement of the
tender documents, the second ranked tenderer will be evaluated in detail.
Finally the tender evaluation panel will formally recommend the preferred tender to the
appropriate delegate for approval.
Contact
For further information contact:
John Domino
Director Project Services
Phone:
Email:
08 8226 5169
[email protected]
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