TfL hits back at Dutch auction accusations

Transport for London (TfL) has reacted strongly to suggestions that it is solely using reverse auctions to determine its four-year consultancy frameworks.

The response by the transport group follows last week’s news that the Association for Consultancy and Engineering (ACE) had been alerted to the use of e-auctions, which involve an online bidding round to determine a lowest price bidder.

ACE, which totally opposes the use of Dutch auctions and regards them as contrary to EU procurement guidance (not a breach of European rules, as was reported last week), has still not heard back from TfL following their meeting on 17 March.

However, in a lengthy statement, TfL said it had been working very closely with its suppliers since a review of its procedures in 2004 to “capture and share knowledge of faster and lower cost ways of responding to TfL’s requirements” by using e-sourcing tools and that the reverse auction element of bidding was only a small part of the selection process.

“It is vital to understand that TfL’s use of e-sourcing tools in this way is not to be confused with e-auctions of specific pieces of work,” the statement added. “All of ACE’s concerns centre around this latter use and we would share some of these concerns if professional consultancy projects were to be let in this way. 

“The way in which TfL has approached this task actually aids suppliers as it allows them to base their pricing mechanism on better market knowledge than they would otherwise access.

“We have been engaged in discussions with our potential suppliers over the past year and the overwhelming majority have expressed their support for our approach.”

A TfL spokesman, who refused to explain why the group hadn’t responded to ACE, told CJ: “TfL uses different e-procurement tools according to individual tenders and for this contract has pre-qualified and received bids online. The final stage of bidding will refine the price of the contract through an online ‘ranked bid reverse auction’, and cost is only one of a number of elements that will determine the successful bidders.”

ACE communications director Andy Walker said: “We have still had no official response from TfL following our meeting. We are pushing for another meeting.”