Facility for Investment Ready Nature in Scotland (FIRNS) - Procurement Guidance

Published: November 2023

Guidance for Applicants

This guidance note sets out in further detail the procurement requirements for projects preparing to submit an application to the Facility for Investment Ready Nature in Scotland (FIRNS). It is also intended for projects awarded FIRNS funding who have not yet started their procurement exercise(s).

Procurement expectations are already included in fund specific information, in a Grant Offer you may already have received and in our Standard Terms and Conditions of Grants, available on our website. This guide therefore extends that information and clarifies in further detail what they mean in practice. It clarifies specific requirements, sets out the evidence NatureScot will ask to see and signposts to resources that can support projects who are less experienced in procurement processes. 

This guide does not constitute procurement advice for your organisation. Undertaking procurement in grant funded projects is the recipient’s responsibility but we hope that this guidance will answer any questions that you may have, offer links to resources and if your application is successful, will prevent any procurement issues arising that may impact your project or the release of funds.  We will be happy to clarify the expectations set out in this guidance note, particularly for those organisations and businesses less experienced in managing public funds and the procurement expectations that come with them. Any queries should be directed to [email protected].

The term ‘contract’ throughout this guidance covers the 2 types of contracts you may have to procure within your FIRNS project:

• Supply Contracts – for the purchase, lease, rental or hire purchase of products and equipment.
• Service Contracts – for the provision of services such as consultancy.

Procurement and public bodies

This procurement guidance note does not apply to public bodies. The Public Contracts (Scotland) Regulations 2015 apply to contracts being tendered and let by public bodies. Public bodies include central, regional and local authorities, bodies governed by public law and associations formed by one or more of these authorities or bodies. A full definition of a body governed by public law can be found in Annex 1.  This includes the circumstances within which organisations such as charities or trusts would be subject to the regulations. NatureScot will not advise on your organisation’s status.

The key principles of public sector procurement of being able to demonstrate openness, fairness, transparency and equal treatment when purchasing goods, services or works using public funds apply. FIRNS awards public funds therefore the principles above must be applied to procurement exercises in successful projects. Open procurement can bring wider benefits to your project and to our funding programmes through working with and supporting a wider and more diverse range of contractors, some of who may be new and offer different insights and approaches.  As well as these key principles, it is also essential to demonstrate that value for money has, or will be, achieved.

Undertaking procurement exercises are the responsibility of the grant recipient however we may ask you to seek our approval before letting a contract. This will be based on the value of the contract and/or may relate to some of the project risks you have identified.  Any approvals required will be clearly set out in any Grant Offer that we issue.

Meeting our competition requirements is essential in demonstrating that the procurement principles have been met. Table 1 below sets out our minimum expectations - these are also included in fund specific information including in our Grant Application Form, in any Grant Offer that we issue and in our Standard Terms and Conditions, available on our website. The table also sets out what further information and approvals may be required if you are unable to meet the minimum competition requirements.

Note: A Single Tender Action (STA) – where you intend to ask only one supplier to quote/tender - is covered elsewhere in this guidance. Receiving only one quote when you have invited several, or openly advertised, is not a STA situation.

Table 1: FIRNS Thresholds and Minimum Competition Requirements

Purchasing thresholds including any non-recoverable VAT	Minimum Competition Requirements	Further information and approvals that will be required
£1,000 and below	x 2 Quotes  – to enable a value for money comparison	None
£1,000 to £25,000	x 3 Written Quotes - a minimum of 3 suppliers to be invited to quote	Justification required if other than lowest quote is opted for. Explanation required if only one quote received.
£25,000 to £50,000	x 5 Written Quotes - a minimum of 5 suppliers to be invited to quote	Justification and approval required if 5 suppliers not invited to quote. Justification and approval required if other than lowest quote is opted for. Justification and approval required if only one quote received.
£50,000 and above	Advertise and full procurement tendering exercise	Public Contracts Scotland (PCS) portal is the preferred route to advertise all contract tender opportunities and MUST be used for all contracts of £50k and over, inclusive of VAT. Contracts must be advertised for a minimum of 3 weeks. Supply only contracts may be procured outwith PCS with our prior approval. A minimum of 5 written quotes must be invited with approval requirements as set out in the £25k - £50k threshold above. Approval required if only one tender received (no competition).

Justifications and requests for approval noted above should be sent directly to your Funding Officer. We will aim to respond to approval requests within 5 working days but it may take longer - you should ensure sufficient time is factored into your procurement processes and project delivery.

If you have your own procurement policy and would wish to procure on a different basis from the thresholds above you must get our prior approval. Your policy should be submitted with your full application if you are invited to apply. We will review whether your policy offers a level of threshold competition that is comparable with our minimum requirements and will confirm in the terms of any funding award.

Options for sourcing quotes are shown below. If your project is successful, we will ask you to acknowledge FIRNS funding when you advertise contract opportunities – this will be set out in the terms of any grant award and in our ‘How to Acknowledge our support for your project Guidance’ available on our website.

• Public Contracts Scotland (PCS)

To allow you to reach as wide a pool of potential contractors and suppliers as possible, we encourage use of the Scottish Government’s Public Contracts Scotland (PCS) portal.  The PCS portal is widely used by the public sector organisations to publically advertise, tender and let new contract opportunities. It is our preferred approach and can be used for a full range of contract values.

Use of PCS is a firm requirement for contracts above £50k with the exceptions noted in Table 1. For contracts over £50k advertised via PCS, you may simultaneously source quotes/tenders by other means to further broaden reach however you must be very clear about all the platforms being used simultaneously to invite quotes and receive responses in each option that you use. You must also ensure that the information available to potential suppliers is exactly the same with the same date and time given as the deadline. (Example: if you place a contract opportunity on PCS but also on your social media account, in both of those places you must be clear that the opportunity is also available on PCS/social media (as relevant) and that responses can be made via PCS or by email).

If you have advertised openly on the PCS portal, there is no minimum number of tender bids or quotes that you need to receive. However, as outlined in Table 1, in most instances you will need approval to let a contract where only one has been received.

The PCS portal has a range of information and support guides on the website as well as a dedicated Customer Service Team that can be contacted by email or telephone. The details are available on the website link above. Your Funding Officer is unable to provide advice on using the portal.  Important: To use the PCS portal, you will first need to register free as a ‘buyer’ via the PCS portal: Public Contracts Scotland - Register as a buyer . If you have any difficulty registering as a non-public body, you should email the PCS Customer Services Team confirming you are required under the terms of your Grant Offer, funded by Scottish Government, to use the portal.

•  Public Contracts Scotland ‘Quick Quote’ facility  

Quick Quote is an online quotation facility that enables you to obtain competitive quotes electronically. It enables you to search suppliers that are registered with PCS and directly invite them to submit a quote.

Further information can be found on the PCS website link above and in the Public Contracts Scotland - Quick Quote User Guide.

• Directly email suppliers to invite a quote

For contracts under £50k, if you are not using the PCS portal, we need to be confident that the opportunity to quote for a contract is open, fair and transparent. It is our expectation that the number of quotes required in each of the procurement thresholds is achieved. This means that you may have to invite bids from a greater number of contractors to be confident in receiving the number required. Potential suppliers and contractors could be identified through:

• experience and knowledge from other projects you have been involved in
• making contact with projects who have done similar things
• recommendations from project partners or stakeholders
• on-line searches

We understand that securing quotes from suppliers can sometimes be challenging. If you request approval to award a contract where the minimum competition requirements have not been met, we will ask you to provide evidence of all your efforts to secure quotes. It is therefore important that you save all emails that you send and receive, including those where a supplier or contractor has declined. Evidence requirements are fully covered further on in this guidance. 

It is important that when inviting quotes or tenders, you provide potential suppliers and contractors with sufficient information to enable them to provide you with a detailed and accurate quote or bid. All potential contractors must receive the same information to ensure equal treatment.

• Advertising

You may choose to advertise your requirements for under £50k contracts that are not being advertised on the PCS portal. This is likely to have a more limited reach and would best be used in parallel with a direct invite to potential suppliers and contractors as above. As already noted, if you are advertising a contract opportunity in more than one place, this must be made very clear in each of the advertisements. Options for advertising include:

• your website and the project website if you have one
• your social media platform and those of your project partners if you have one
• trade journals or other sector newsletters

For contracts over £50k, you may use social media or your website to advertise that a contract opportunity has been advertised on PCS, advising any interested suppliers to submit a bid via PCS.

By exception, we will consider a Single Tender Action (STA) request which will require you to submit a Single Tender Justification (STJ) for approval. NatureScot will provide a template for this.

A Single Tender Action is where you invite only one supplier or contractor to quote or bid for a contract. It also covers situations where a landowner, who may or may not also be the grant recipient, is proposing to undertake works as a contractor. An STA should not be confused with situations where you advertise or invite multiple quotes/bids but receive only one – those instances are covered by the competition requirements and approvals set out in Table 1.

Your STJ must provide a strong case as to why your preferred contractor is the only one able to meet the requirements of the contract. It must explain:

• why you will not seek other quotes or openly advertise the opportunity, including why you don’t intend to use PCS
• other contractors you may have considered and why they will not be approached
• the assessment that you will undertake, and evidence you will gather, to be assured of a fair market price and value for money.

All single tender situations should be considered and evaluated by us before you begin the procurement process. Our primary assessment of your STJ request will be on the rationale for not seeking or inviting others to quote or bid, not simply the merits of your preferred supplier or contactor.

For all approved STA cases, you must receive a quote or tender from your preferred supplier or contractor.

We understand that there are situations where an STA may be required, for example very specialist skills or equipment required, but there are no situations that we can set out in this guidance where a STJ will automatically be approved. Based on a number of STJ’s received within the FIRNS programme to date, the following reasons will not guarantee approval in their own right:

• Current or previous experience with a contractor
• An organisation having a preferred supplier or contractor list
• Contractor involved in application development
• Not knowing of a sufficient number of contractors to meet the minimum competition requirements
• Remote or island location
• Value of contract
• Environmental sustainability (for example in materials or transport to site)
• Distance from the project site(s)
• Supporting local economy
• Limited time due to seasonality of activities
• Delayed FIRNS decisions or meeting FIRNS deadlines

In a STA situation, if you have already sought a quote or bid from a preferred supplier or contractor prior to your application being submitted, or have one ‘on hold’ subject to our decision, you cannot assume that we will approve your STJ. If you are requesting FIRNS funds to pay for or contribute to the contract, you must be prepared to undertake a new procurement exercise and ensure this flexibility is built into your project delivery timescale. The quote or bid should be attached to your STJ when submitted for approval.

If goods, services or works have been, or will be, purchased using FIRNS grant funding, it is essential that you maintain a full audit trail of procurement Documents of Evidence. Annex 2 sets out the Documents of Evidence that you are required to retain, helpfully also setting out key steps in a procurement process for projects less experienced in procurement with public funds.

Procurement evidence will be required in support of claims for payment and for any approvals you may request in relation to the minimum competition requirements in Table 1. The Terms and Condition of any Grant Offer we make to you will set out the specific evidence required and when it should be provided. Procurement evidence is additional to the financial information and records you are required to keep as set out in our Financial Information and Records Guidance available on our website.

The Scottish Government’s Procurement Journey provides online guidance and templates for public sector procurement, and these can also be used by FIRNS projects. It covers key parts of a procurement exercise such as preparing a brief and offers an evaluation scoring matrix for lower and higher value contracts. The Procurement Journey website can be viewed here.

Annex 3 provides links to key procurement templates taken from the Procurement Journey that you can use or adapt for your own project needs. These are aimed at public sector contracts up to £50k however they will be helpful for projects of all values. You do not need to use these templates, though we encourage you to read the guidance and use/adapt the templates as much as possible.

Irrespective of the route used to secure quotes and tenders (mandatory/optional use of PCS, directly inviting quotes and/or advertising) there are basic elements that every quote/tender bid needs to show. These confirm that the quotes/tenders are current, accurately reflect what is being proposed in the project, accord with the project application form and enable invoices to be matched to the costs and requirements when funds are being claimed.

The minimum requirements are that:

• quotes/tenders are addressed to you (as the applicant) or your appointed agent
• quotes/tenders are dated and signed where relevant
• quotes/tenders are in written or printed form and clearly originate from a reputable contractor who can deliver the goods/services
• the contractor's contact and business details are clear and legitimate - on business headed notepaper and including their companies registration number where relevant
• quotes/tenders are based on the same specifications as described in the application
• tenders are fully itemised, with a schedule that provides a breakdown of costs for each of the main stages of the work or for the individual items to be supplied
• quotes/tenders are compliant with the Statement of Requirements
• there are no missing elements
• there are no ineligible elements
• cost calculations are up to date, correct and precise
• quotes/tenders should confirm for how long they are valid
• all pricing should be net of VAT, with any VAT clearly shown separately
• evidence that the contractor can deliver the work to the required timescales.

Where appropriate, your quotation/tender documentation should be asking bidders to include in their submissions details or copies of their Health & Safety Policy Statement and Insurance requirements, such as, Public Liability, Professional Indemnity and Employer’s Liability. Where appropriate and proportionate, bidders should also be asked to submit a sustainability policy if they have one.

This stage of the procurement process has become the subject of much scrutiny and criticism in recent years. The Freedom of Information Act (Scotland) 2002 has led to a notable increase in the level of documentation relating to the evaluation of quotes / tenders being released into the public domain, and it is your duty to ensure that any procurement process can withstand such scrutiny.

This stage of the process ensures that:

• the contract award decision is objective
• the decision-making process is fair, transparent and auditable
• you can demonstrate that value for money (not just in terms of price) has been obtained.

It is important that the evaluation process is robust, regardless of contract value, in order to provide a full audit trail of how an award decision was reached. We may ask to become involved in your evaluation and scoring exercise or alternatively, may request that you use specific scoring criteria and weighting. These requests will be contained within the terms of any grant award we may make.

Annex 4 sets out basic procurement good practice that includes some ‘dos and don’ts’ for evaluating and scoring.

Meeting the public sector procurement principles is a significant part of accepting a grant from public funds and it is important that you fully understand what steps we will take if your procurement practice does not meet our expectations. We may:

- ask you to undertake a full procurement exercise

• for example, where you progressed a Single Tender Action but it was not approved

- ask you to re-do a procurement exercise

- for example, if you are unable to provide the procurement evidence that we ask for

- delay a grant payment

• for example, if evidence is incomplete or missing

- withdraw our offer of funds for specific items, works or the project as a whole

• for example, if you enter into a formal contract prior to receiving and accepting a formal offer of funding from us

We encourage you to think about your procurement needs and how you will meet the minimum competition requirements as early as possible in your project planning and we welcome steps you may take to be well prepared should your application be successful. It is at the project’s risk however if you gather quotes or tenders in advance and are unable to provide the level of supporting evidence outlined in Annex 2.

Fair Work First is the Scottish Government’s flagship policy for driving high quality and fair work across the labour market in Scotland by applying fair work criteria to grants, other funding and contracts being awarded by and across the public sector, where it is relevant to do so. From 1st July 2023, grant applicants may be asked to verify their Fair Work First commitment - payment of the real Living Wage and an effective worker’s voice criteria are mandatory. You may also be asked to demonstrate how your procurement and contract management processes meet the Fair Work First criteria.

Further information can be found in accompanying guidance for FIRNS grant recipients and on the following Scottish Government webpage: Scottish Government: Fair Work First Guidance

Sustainability comprises the environmental, social and economic aspects of goods, services and works bought by FIRNS projects as part of overall best value. Further information on Sustainable Procurement in NatureScot is available on our website and this will help you to consider how you can relate these expectations to your project:  Sustainable Procurement in NatureScot

As a minimum, you should consider the following Generic Sustainability Criteria in your procurement exercise(s) where relevant:

• Low carbon emissions
• Low resource use – for example materials, energy, transport, paper
• Recycled or re-used materials
• Fair Trade or Ethically-produced products, where they exist
• Less waste produced and easy to recycle Note: FIRNS is unable to fund single use plastics.

It is the responsibility of grant recipients to ensure compliance with all domestic and European legislation and regulations relevant to the Project as set out in our Standard Terms and Condition of Grant available on our website. In addition to Fair Work First and Sustainable Procurement, applicants and recipients are advised to ensure their procurement practice considers ethics and human rights. Further information can be found at:

• Human Trafficking and Exploitation (Scotland) Act 2015 – UK Government Legislation 2015 
• United Nations Human Rights Guiding Principles on Business and Human Rights

United Nations Guiding Principles on Business and Human Rights 

If your project requires the appointment of paid staff, whether full or part time, and it is your intention to contract rather than directly employ onto payroll then the minimum competition requirements set out in this guidance must be met.

Direct employment of paid onto payroll staff falls out with the scope of procurement guidance but for clarification, the following summarises our recruitment expectations for grant funded projects:

• All posts must be openly and fairly advertised. We may ask to see evidence of the recruitment exercise you undertook or to become involved in the recruitment process.

The following exceptions can apply without the need for approval:

• Existing paid members of staff may be moved into the post if they have the necessary skills and experience. In the terms of any Grant Offer we may ask to see evidence of their suitability and to approve their appointment in advance
• Existing paid members of staff may have their hours increased to enable them to work for the project. As above, in the terms of any Grant Offer we may ask to see evidence of their suitability and to approve their appointment in advance

You must seek our approval in advance if:

• You are a family or small business and you wish to appoint a family member or friend to a grant funded post.
• You wish to appoint a volunteer to a paid post
• You wish to move a contractor into an employed post

Annexes