Legal services

Description

Legal Panel in relation to the Thames Tideway Tunnel and Ofwat’s Direct Procurement for Customers initiative The procurement involves the establishment of a framework agreement for use by Ofwat only. It is anticipated that one (1)panel agreement will be awarded for Lot 1 — Thames Tideway Tunnel and up to four for Lot 2 — Ofwat’s Direct Procurement for Customers initiative. This procurement relates to the legal services which are listed in Schedule 3 of the Public Contracts Regulations 2015 (PCR) 2015 as a specific service. This procurement is being conducted under the Light Touch Regime (‘LTR’) is therefore subject to limited regulation and will be conducted in accordance with regulations 74 to 76 PCR 2015. Any agreement will be for a period of four (4) years in total. The Thames Tideway Tunnel (TTT) is the main tunnel component in Thames Water Utilities Ltd’s (Thames Water) solution for reducing overflows of untreated combined sewage into the river Thames, in order to achieve compliance with the Urban Waste Water Treatment Directive. The other components of the solution (which have already been completed) are the Lee Tunnel and upgrades at Beckton sewage treatment works. The TTT was specified as an infrastructure project by the Secretary of State in June 2014 under the Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013 (SIP Regulations). The Thames Tideway Tunnel Project Specification Notice sets out the scope of the Project and required Thames Water to put the Project out to tender to be delivered by an infrastructure provider (IP). The preferred bidder in the IP procurement (Bazalgette Tunnel Ltd, now trading as Tideway), was announced by Thames Water on 13 July 2015. Tideway then became the party contracting with the main works contractors who had been procured by Thames Water in February 2015. These contracts were all finalised on 24 August 2015 and Ofwat issued Tideway with a Project Licence on the same day. This contract is for the provision of legal advisory services to Ofwat’s legal and policy teams in relation to the TTT project and to support Ofwat in its regulation of Thames Water and Tideway in respect of the Project, in particular to ensure that the TTT is delivered at best value for Thames Water’s customers. We are looking to award a single supplier panel agreement in relation to our work on the Thames Tideway Tunnel. We are the economic regulator of the water and wastewater sector in England and Wales. Among other things, we regulate the price, investment and service packages that customers receive. For the 2019 price review (‘PR19’) water companies are developing business plans to cover the next price control period (2020-2025). As part of our final PR19 methodology published in December 2017 we introduced the concept of direct procurement for customers (‘DPC’), a process for water companies to competitively tender for a third party to design, build, finance, operate and maintain key infrastructure. We expect water companies to consider the use of DPC for all large-scale enhancement projects that cost over GBP 100 m based on whole-life total expenditure. Each water company is expected to provide an assessment of the suitability of relevant schemes in their business plan which will be submitted to Ofwat in September 2018. We want to ensure that where DPC is used: — consumers’ interests are protected; — value for money is achieved; and — we are assured that water companies’ obligations will be met to an equivalent or better standard compared to a traditional delivery route. Where a project is suitable for DPC, the water company concerned (not Ofwat) will run the procurement process. We will however provide oversight, will require water companies to follow our principles for procurement and contracting when undertaking DPC projects and will seek appropriate levels of assurance during the procurement process. Our work will continue beyond PR19, which concludes in late 2019. Projects will be large, complex and long-term in nature. Contracts are generally expected, in addition to the initial construction period, to have an operational period of about 15-25 years. Water companies may not be ready to (or need to) begin procurement processes by 2020, depending on the tender model and the need for the project. This contract is for the provision of expert legal advisory services to Ofwat in relation to DPC-related work. Robust legal advice will be required to enable us to carry out our oversight role in relation to DPC projects. We are looking for support to help us: — understand and engage with legal, commercial and contractual issues relating to DPC projects; — manage the challenges in translating policy into practice; and — take effective and robust decisions in relation to DPC projects. We are looking to award three to four companies to the panel agreement to support our work in relation to projects procured by water companies under Ofwat’s Direct Procurement for Customers initiative.