Press Release: SME Chamber welcomes reactivation of Bank moratorium possibility
18 January 2021
FURTHER EXTENSIONS WILL BE NECESSARY The Malta Chamber of SMEs greatly welcomes the extension granted...
The meeting held today with the Contracts Department was called by GRTU following complaints we received from our members.
Graphic Designers cannot bid due to high thresholds – GRTU was approached by self-employed graphic designers complaining of a clause in a tender document they were interested to apply for: "The maximum amount of sub-contracting must not exceed 40 % of the total contract value. The main contractor must have the ability to carry out at least 60 % of the contract works by his own means."
This, GRTU argued, is prohibitive and heavily limits the participation of such micro service providers and self-employed because while being able to fulfill an important part of the tender requirements, their share still constitutes much less than the 60%. GRTU spoke especially for those micro and self-employed enterprises who's main operation relies most especially on their artistic ability and do not have the capital to invest in materials of production such as printing machinery.
In most cases the price of the art is much lower than the actual production, as such the 40% limit of the total contract value is prohibitive to the graphic designer, who is still able to deliver a finished product instead of submitting his own quotation.
The Contracts Department explained that they do see GRTU's point. They said that these specifications are not standard and are included by the body issuing the tender as it deems fit, and in other cases such clauses do make sense. The Contracts Department also explained that in any case if an interested bidder feels there is lack of fairness or transparency the bidder can ask for clarification and argue their case.
The contacts department however also confirmed that such thresholds are prohibitive to the participation of independent graphic designers and therefore they will guide the bodies issuing tenders in a way not to prohibit such bidders from participating. GRTU was pleased with this arrangement.
Sub-contracting to self-employed
The second point raised by GRTU was related to the "Statement on Conditions of Employment" accompanying a tender. The paper stated that "Tenderers are to ensure that self-employed personnel are not engaged on this contract. Non-compliance will invalidate the contact". GRTU members interpreted this as meaning that they cannot sub-contract to self-employed individuals and therefore felt they were unable to bid for the tender because they can supply materials but they must sub-contract to self-employed individuals to carry out the works. The Contracts Department clarified that the case GRTU is putting forward was not of engagement of self-employed but sub-contracting. Therefore there was no issue.
Compliance with Environmental laws
The last point presented by GRTU was that the Contracts Department ensured that bidders being awarded a contract were complaint with VAT regulations and any other regulations which ensured that only those abiding to Maltese Law were awarded tenders and therefore ensuring a level playing field. The GRTU however informed the Contracts Department that enterprises today are also abiding to very costly environmental obligations which also should be taken into consideration when awarding tenders.
The price put forward by a bidder who abides with his environmental obligations is certainly less than the price of a bidder who doesn't. Compliance with the Waste Packaging Directive by all importers is imperative under Maltese Law, therefore awarding contracts also to non-complaint enterprises does create an unlevel playing field and does encourage non compliance since the bidding price will be inevitably lower.
The Contracts Department immediately assured the GRTU that in no way is their intention to encourage non-compliance and therefore will immediately initiate talks with other Government Departments to see how this objective can be achieved. They explained this would probably be included as a clause in the tender document but discussions would have to be carried out to assess any impact this might have. GRTU was also pleased with this arrangement.
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