Research Buying Unit
Level 2
2 St Paul’s Place
125 Norfolk Street
Sheffield
S1 2FJ
Claire Crawford
IFS
Direct line: 0114 207 5120
Email:[email protected]
Our ref: BIS/RBU/016/2011
Date: 6th September 2011
BY EMAIL ONLY
INVITATION TO TENDER FOR A RESEARCH PROJECT ENTITLED: GRADUATE
PREMIUM – FURTHER ANALYSIS
DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS TENDER NUMBER:
BIS/RBU/016/2011
1
Your organisation along with others is invited to offer a tender for provision of
the above, to the specification outlined in the attached documents. Attached
are:
Annex 1
Annex 2
Annex 3
Research specification;
Tender acceptance/ rejection form;
Declaration and information form.
2
Guidance on BIS research tendering procedures is attached.
3
All contracts are let on the basis of the Department’s terms and conditions,
which I have attached. You should not include your own terms and conditions
when submitting tenders or ask that the terms and conditions relating to any
framework contract you may have with the Department be used as an
alternative.
4
After reading the attached specification please complete the tender
acceptance/rejection form (Annex 2) and email it to me at
[email protected] by Monday 12th September 2011
If you decide not to tender for the project, the reasons for your decision would
be appreciated, though you are under no obligation to do so.
5
You should submit your tender in electronic Word format to
[email protected] Full tenders should be received no later than noon on
Tuesday 4th October. Late proposals will not be accepted.
6
Should you have any queries please contact [email protected] or
[email protected]
Yours sincerely
Carole Hobson
Research Buying Unit
cc Dominic Rice
Tongtong Qian
Encs
LIST OF ATTACHMENTS
Annex 1
Project Specification
Annex 2
ITT Acceptance/Rejection Form
Annex 3
Declarations and information to be provided by the tenderer with
their tender proposal
ANNEX ONE
RESEARCH SPECIFICATION
Introduction and Background
1. In 2010 the Government introduced changes to the Higher Education tuition
fee in the Higher Education (Higher Amount) (England) Regulation 2010.
From September 2012, universities and others providing Higher Education
(HE) will be able to charge up to £9000 a year for their courses1 provided they
will meet strict criteria to make sure that all eligible students, regardless of
background, can access those courses.
2. As a result of these changes it is important that we are able to provide as
much information on the benefits of HE to potential students as possible to
ensure they can make well informed decisions about whether to attend HE
and if so what to study and where.
3. One widely used measure of the financial benefit of HE is the graduate
premium. This is that over their working life, graduates earn, on average,
comfortably over £100,000 more, net of tax and in today’s valuation, than an
individual whose highest qualification is 2 or more A-levels. Whilst this is not a
complete measure of all the benefits of attending HE, it does capture some of
the main benefits, notably the earnings premium and employment boost, and
so provides a useful indication for applicants. The return, and the rate of
return to a degree - both for individuals and the Exchequer - are also widely
used as measures of the benefits.
4. Research by London Economics, The Returns to Higher Education
Qualifications (2011) on behalf of BIS updated the graduate premium
calculation with the most recent data from the Labour Force Survey (LFS). It
also expanded these calculations to look at the graduate premium by gender
and qualification type, as well as subject of study and degree classification at
undergraduate degree level. The exchequer benefit was also calculated. This
work builds on previous research in this area such as The Economic Benefits
of a Degree by PWC for UUK2 and The Return to a University Education in
Great Britain by O’Leary and Sloane. In addition, there are numerous studies
examining just the earnings returns, and using alternative data sources such
as national cohort data.
5. The main problem however, as demonstrated by the further disaggregation
carried out in the London Economics research, is that this is only an average
across all institutions, subjects and backgrounds. There is evidence that there
is significant variation in the returns based on characteristics such as the
degree subject studied3. Other characteristics that have not yet been
examined are likely to also influence the returns to HE, whilst the changes in
1
Tuition fees for certain courses at private universities are not subject to this limit
Which was in turn based on earlier work The Economic Benefits of Higher Education
Qualifications, PWC for RSC&IOP
3 Whilst it is likely that some of this variation is related to the inability to accurately measure
the counterfactual, this is unlikely to fully take account of all variation so we can be fairly
confident that there are ‘real’ differences in the returns and the graduate premium by subject
studied.
2
the HE landscape and graduate labour market may have led to changes in
the returns over time, or to different cohorts of graduates. Consequently more
detailed analysis of the returns to HE and the graduate premium is required to
enable applicants, HE Institutions (HEIs), and policy makers to make better
informed decisions.
Main Aims
6. The main aim of this research is to provide further breakdowns of the returns
to HE and the graduate premium, for both individuals and the exchequer, to
better inform both potential students and future policy. A secondary aim is
also to identify and make clear what the limits are to such analyses – i.e.
given available methods and data, to what extent will some breakdowns be
limited or not possible (and may never be possible), and what might we use
instead.
Objectives
7. The contractor will need to:
a. consider a range of data sources in order to assess what breakdowns
of the returns to HE, the graduate premium and the exchequer benefit
are possible. Breakdowns that are of particular interest include:
 By cohort, in particular, assessing if the returns have changed
for recent cohorts
 By HE institution
 By ethnic background
 By family background
 By detailed subject area
 By geography/region of location of the HEI (and possibly also of
the domicile of the graduate).
 Analysis of returns and the graduate premium for part-time
students.
BIS is also interested in what other breakdowns the contractor thinks
may be possible.
b. calculate breakdowns that are agreed as feasible and of interest to
BIS.
c. present this work in a report to be published as part of the BIS
research series. As well as presenting the results of the calculations,
this must clearly cover:
 methodology
 limits and caveats to the calculations and the data used
 comparability with previous estimates (in particular the recent
BIS report referred to in para. 4), and explanation of any major
differences
 some explanation/interpretation of the findings, in particular for
any notable or unusual results
 any consequent recommendations.
Method
8. The contractor is expected to apply similar analytical methods as used in the
existing literature on the returns to education in order to calculate earnings
and employment returns of different HE qualifications, using statistical
techniques to isolate the effect of the degree from other confounding factors,
for the different breakdowns agreed.
9. The contractor will also ensure that these returns are measured against an
appropriate comparison group and that the estimates produced are both
robust and meaningful (for example: pooling data sets in the LFS in order to
obtain a sufficiently large sample size; ensuring that any variations in the
estimates obtained by different breakdowns do not occur for spurious
reasons).
10. The contractor should also extend the analysis to calculate the lifetime returns
of these qualifications based on the agreed breakdowns, where possible (and
explaining why if it is not). These returns should also be calculated using
similar methodology to the existing literature, with an explanation of any key
departures from previous analyses. In other words, the earnings and
employment returns should be calculated at different points in the individual’s
lifetime, converted into monetary amounts and aggregated into a single
present value figure. The contractor should also consider the costs over the
lifetime to qualification attainment, including but not limited to the foregone
earnings whilst studying and the tuition costs, in order to generate estimates
of the net lifetime benefit or graduate premium, as well as rates of returns on
the investment.
11. The contractor should also consider the lifetime benefits of HE qualifications
that go to the public, i.e. the exchequer benefit, and the social rates of return
for each of the agreed breakdowns, where possible. This should also be
based on the existing methodology given in the literature. Hence it should
include an examination of the additional tax revenue gained from the higher
earnings of graduates, compared to the foregone tax whilst the individual is
studying and the public costs of provision. We would also be interested in any
other costs or benefits that the contractor is able to consider, such as the
effects of the higher earnings of graduates on benefit entitlement.
12. Further analysis examining the reasons behind any variations in the returns
by the agreed breakdowns should also be carried out by the contractor. The
techniques for this would depend partly on the results of the previous analysis
(e.g. if there are any unusual findings which need further analysis) but we
would also expect the contractor to consider potential reasons for variation in
advance, and to put in place some tests for these hypotheses, the scope of
which will be agreed upon beforehand.
13. As mentioned, we would want the contractor to outline any key
methodological differences with previous analyses, the reasons for these, and
how they might influence the findings. This is particularly so with respect the
recent BIS report on the returns to HE qualifications (June 2011, as
referenced in para. 4). Whilst we would expect this aspect to be properly
covered following the analysis in the final report, it would be useful if any
initial thoughts were noted in the tender.
Staffing
14. The tender should include details of the personnel who would be working on
the project and the relative proportion of the work that will be assigned to
each member of the project delivery team. BIS requires details of relevant
work experience and the roles they will perform for this project. Tenderers
should not simply attach the Curriculum Vitae of each member of staff.
15. If any of the work would be subcontracted or undertaken in partnership with
an external unit details of this relationship and the balance of work should be
provided. BIS also requires a copy of the Quality Assurance arrangements
operating with subcontractors
Timing and Outputs
16. Tenderers are invited to provide timings and relevant milestones for this work.
We expect the project to start in late October/November 2011
17. A draft final report will be required by 30th April 2012 with an agreed final
report by 31st May 2012. Tenders are to be submitted by noon on Tuesday
4th October 2011. Tenderers will be informed about whether their bid has
been successful as soon as possible after this date (we anticipate being able
to do this by 14th October 2011, or if not, very soon after this date).
18. BIS may decide to invite a short-list of tenderers for interview before a final
decision is made on award of the contract. If this is necessary interviews will
take place week beginning 10th October – possibly Wednesday 12th (in
London or Sheffield).
19. In order to establish the capacity of the tendering body to meet this timetable,
bids should include details of the current workload commitments of the
proposed project team members.
20. The required outputs for dissemination purposes are:
 The full text of the draft and final reports on disk in Word format;
 A summary of findings in around 1500 words (on disk –there will be
dissemination by electronic means including websites); and
 A presentation of findings to the Steering Group and other colleagues
from BIS.
21. Tenderers are required to provide a one page executive summary of their
proposal in the tender pack.
Project Management
22. The project will be managed on a day-to-day basis by Higher
Education/Knowledge and Innovation Analysis Division (BIS). It will be
overseen by a steering group made up of representatives from BIS (analysts
and policy) and the contractor. The contractor will be expected to attend all of
these Steering Group meetings and take-on board commentary offered
through them.
23. It is envisaged there will be around 3 or 4 steering group meetings during the
project, including one at the start and one towards the end after the draft final
report has been received. The expectation is that all the meetings will be held
at BIS offices in Sheffield (although other venues may be considered for
some of the meetings depending on schedules of SG members).
FORMAT OF PROPOSAL
Proposal should be in the following format.
Section 1
Table of Contents
Section 2
Summary of Proposal
Section 3
Meeting the Specification:
 Aims;
 Objectives;
 Methodology;
 Project management;
 Staffing; and
 Outputs.
Section 4
Risk Management
Section 5
Data Security
Section 6
Cost and Charging Arrangements
Section 7
References and Experience
COSTS
Your tender should provide a detailed breakdown of costs on the basis of:






project management and professional time;
any fieldwork costs (if applicable);
secretarial and administrative costs;
travel and subsistence (please note details below ;
stationery, postage and telephone; and
publicity.
Costs should be shown separately by financial year and where more than one type of
methodology is involved the costs need to be shown separately for each element,
e.g.:





group discussions;
personal interview;
telephone survey;
postal survey; and
desk research.
It would be helpful if, in addition to these overall costs, tenderers were able to
separately identify some of the costs according to discrete parts of the analysis (eg.
by data source used, by sub-group of interest) in order to provide an indication of
how the costs might vary depending on the scale and coverage of the project.
Your costs should be quoted exclusive of output VAT but please indicate if the
project will attract output VAT.
If your proposal includes costs for sub-contractors these costs must be shown
inclusive of any VAT element (e.g. sub-contractor’s costs to you are £10,000
plus VAT, your proposal should show sub-contractors costs as £12,000
inclusive of VAT).
We reserve the right to extend this contract over and above the services specified in
this Invitation to Tender (ITT) for up to the same contract duration and for up to
50%of the original contract cost for further work that is within the same scope as that
covered in this ITT
Tender Evaluation
The tender process will be conducted in a manner that ensures tenders are
evaluated fairly to ascertain whether the proposal represents value for money.
Responses to our requirements will be evaluated under the following headings (the
order in which the criteria are listed does not imply relative importance and any
elaboration is illustrative only and is not intended to provide an exhaustive list):
Capability

Experience and relevant expertise e.g. track record in similar contracts, in
other relevant research, and in using relevant data sources
Technical assessment

Understanding of the work required and its aims, of other relevant analysis,
and of the policy context

Relevance, efficacy and clarity of the proposed methodology

Consideration of the potential limitations of the analysis

Satisfactory staffing resources and timetable for carrying out the work
required
Financial and Value for Money

Costs

Other value-adding proposals
RISK MANAGEMENT
Tenderers should submit as part of their proposal a one-page summary on what they
believe will be the key risks to delivering the project and what contingencies they will
put in place to deal with them.
A risk is any factor that may delay, disrupt or prevent the full achievement of a project
objective. All risks should be identified. For each risk, the one-page summary should
assess its likelihood (high, medium or low) and specify its possible impact on the
project objectives (again rated high, medium or low). The assessment should also
identify appropriate actions that would reduce or eliminate each risk or its impact.
Typical areas of risk for a research project might include staffing, resource
constraints, technical constraints, data access, timing, management and operational
issues, but this is not an exhaustive list.
DEPENDENCIES
You should indicate if you are reliant on any third party with any information, data or
undertaking any of the work specified.
MONITORING TECHNIQUES
You should indicate how you will monitor the project to ensure it is delivered in terms
of quality, timeliness and cost.
DATA COLLECTION
Researchers will be expected to clear any data collection tools with the Department
before engaging in field work and ensure that in all cases the respondent
documentation and/or interviewer briefing notes clearly state that the data is being
collected for and on behalf of the Department and that no reference is made, implied
or otherwise, to the data being used solely by or available only to the Contractor.
The respondent documentation and/or interviewer shall ensure that the respondent
clearly understands (before they give their consent to be interviewed) the purpose of
the interview, that the information they provide will only be used for research
purposes and, in the case of interviews (telephone or face-to-face), that they have
the right to withdraw from the interview at any time.
The Department seeks to minimise the burdens on schools and Local Authorities
(LAs) taking part in surveys. It is therefore important that tenders should set out how
the proposed methodology will minimise the burden on schools and/or LAs and a
justification for the proposed sample size.
When assessing the relative merits of data collection methods the following issues
should be considered:

only data essential to the project shall be collected;

data should be collected electronically where appropriate and where schools
and/or LAs prefer this;

questionnaires should be pre-populated wherever possible and appropriate;

schools must be given at least four working weeks to respond to the exercise
from the date they receive the request;

LAs should receive at least two weeks, unless they need to approach schools
in which case they too should receive 4 weeks to respond; and
The Contractor shall clear any data collection tools with the Department before
engaging in field work.
Researchers shall check with the Department whether any of the information that
they are requesting from schools can be provided centrally from information already
held.
THE USE OF INCENTIVES
With some important exceptions, the Department believes that the routine use of
respondent incentives in surveys is, in general, not justified as they are rarely cost
effective in either increasing participation or reducing non-response biases. If you are
proposing the use of respondent incentives in your tender proposal you must set out
why you feel they are necessary, why it is not possible to achieve the required
sample sizes or response rates without the use of incentives, how and to what extent
they will raise the overall response rate, how you will mitigate any specific biases that
could be introduced, and provide a cost comparison with non-incentive methods.
Your arguments should be supported by empirical evidence from past use. The
exceptions are payment for participation in group discussions or in-depth qualitative
interviews, payment to cover respondent expenses e.g. travel and childcare costs,
and compensation for excessive demand on respondents, e.g. taking basic skills
tests, diary keeping, panel maintenance and compensating schools for the
respondent’s time. If you wish to use a prize draw incentive then you must also set
out in your tender how you will comply with all relevant legislation and codes of
practice (e.g. the British Code of Advertising and Sales Promotion), state that you
shall be solely liable for any breach of these and that you shall indemnify the
Department against any claims that may be made under them.
DATA PROTECTION ACT 1998
If the project will involve the collection of personal data please state how you will
ensure compliance with the Data Protection Act 1998.
FREEDOM OF INFORMATION
The Department is committed to open government and to meeting their
responsibilities under the Freedom of Information Act 2005. Accordingly, all
information submitted to the Department may need to be disclosed in response to a
request under the Act. If you consider that any of the information included in your
tender is commercially sensitive, please identify it and explain (in broad terms) what
harm may result from disclosure if a request is received, and the time period
applicable to that sensitivity. You should be aware that, even where you have
indicated that information is commercially sensitive, we may still be required to
disclose it under the Act if a request is received. Please also note that the receipt of
any material marked ‘confidential’ or equivalent by the Department should not be
taken to mean that we accept any duty of confidence by virtue of that marking. If a
request is received, we may also be required to disclose details of unsuccessful
tenders.
ANNEX 2
ACCEPTANCE/REJECTION FORM
RESEARCH PROJECT:
GRADUATE PREMIUM – FURTHER ANALYSIS
REFERENCE NUMBER:
BIS/RBU/016/2011
Please complete and sign this form and return it, by email to
[email protected] by Monday 12th September. If this form is not
returned by this date we will assume your organisation will not be submitting a
proposal.
(Please tick the appropriate box)
ACCEPTANCE OF INVITATION TO TENDER
We will be submitting a tender proposal
REJECTION OF INVITATION TO TENDER
We will not be submitting tender proposal
ORGANISATION:
……………………………………………………………………………………
NAME IN CAPITALS:
..............................................................................................................
TEL…………………………………………………..
DATE: .................................................................
ANNEX 3
The Department’s Reference No: BIS/RBU/016/2011
DECLARATIONS AND INFORMATION TO BE PROVIDED BY THE TENDERER
Declarations
1
...............................................……………………………. declare that we
accept the Department’s standard terms and conditions as the basis of the
contract; and
2
declare that we have not communicated to any other party the amount or
approximate amount of the tender price other than in confidence and for the
express purpose of obtaining insurances or a bond in connection with this
tender. The tender price has not been fixed nor adjusted in collusion with any
third party, and
3
declare that the tender will remain valid until 4th March 2012 and that we are
not entitled to claim from the Department any costs or expenses incurred in
preparing the tender or subsequent negotiations whether or not the tender is
successful.
signed on behalf of the Tenderer
..................................................................................
Please print full
name…………………………………………………………………………
Date……………………………………………………………………………………
……….
Undertaking
The Department requires all tenderers to make full and frank disclosure to the
Department in the form of a signed undertaking in respect of any or all of the
following:
a)
any state of bankruptcy, insolvency, compulsory winding up,
administration, receivership composition with creditors or any
analogous state of relevant proceedings;
b)
any convictions for a criminal offence committed by the tenderer (or
being a company, by its officers or any representative of the
company);
c)
any acts of grave misconduct committed by the tenderer (or being a
company, by its officers or any representative of the company) in the
course of their business or profession/the company's business;
d)
any failure by the tenderer (or being a company, by its officers or any
representative of the company) to fulfil their obligations relating to
payment of Social Security contributions; and
e)
any failure by the tenderer (or being a company, by its officers or any
representative of the company) to fulfil their obligations relating to
payment of taxes.