So, up front, I have no experience of contracting for railway purchasing at all and very limited scope looking at procurement in my industry. However, I can see that procurement particularly for government organisations probably has broadly similar themes.
- All decisions have to be made based solely on the information supplied by bidders and possibly consultations with industry experts about generic points only - carrying out external research on the bidders is not permitted
From my limited experience in other industries this seems to be very common. It prevents outside influences with unknown agendas or financial interests "poison pilling" a competitor. Most organisations in my industry aren't subject to OJEU or its new UK version procurement (and most individual contracts fall below the limits anyway) so it is much more common to see tenders written to a precise product with suppliers effectively bidding only on price or follow on support and this prohibition remains the case.
- Similarly, rejecting bids because the quality is suspected to be poor is not allowed unless the price is abnormally low - previous poor reputation is not allowed to be a factor unless demonstration of previous performance was a factor explicitly written into the ITT
I have a suspicion that the DFT would look poorly on a process that allowed procurement using previous reputation simply because it would eliminate any element of competition with so few bidders. Realistically looking at the DMU market as in the Northern/TfW/WMR procurement the only two bidders were CAF and Stadler. If you eliminated one for poor performance no more competition. I suspect a well written ITT (invitation to tender) would get around this by specifying performance closely to one manufacturer but this then would be very vulnerable to challenge. Didn't the latest Danish locomotive purchases effectively block several competitors by specifying it had to be in service elsewhere in the EU for a specific amount of time to bid? Problem is that with the UK specific loading gauge and signalling systems this just doesn't seem practical.
- There is a requirement to select the lowest bidder which does not have a specific reason to reject it.
There is a tyranny in all procurement of lowest price technically acceptable bid versus overall best value. To use an example; purchase PPE from an internationally known supplier which will guarantee the kit in terms of failure absent wear for 10 years when the EN* standard is 5 years guarantee or purchase from a supplier of lower quality but still acceptable kit which meets the EN. The 10 year kit is slightly more expensive but probably won't have to be replaced as soon so lower overall cost. However, you have to justify writing the ITT to exceed the EN if challenged by a supplier which is hard.
* Euro Norm, similar to a British Standard but EU wide, many are now the same i.e. BS EN XXX
Lowest technically acceptable isn't always overall lowest cost but it is very hard to write an ITT not vulnerable to challenge if diverging from the standards would be better value.
On a more general point the big problem for government procurement is the number of suppliers is dwindling for big ticket or specialised items with the amalgamation of manufacturers. If you compare the recent railway rolling stock purchases mentioned above i.e. it was down to CAF or Stadler you start to see parallels in defence procurement to use another large cost limited options environment. For example the bidding for the Type 31 Frigate, which specifically was meant to encourage bidders other than BAE, ended up being BAE vs. an alliance of smaller manufactures, so only two bidders with a third with no realistic chance. Same for example in the upgrade programme for the Warrior IFV which has now been cancelled after costing over a billion and not producing results, only two compliant bidders.
Even if one of the suppliers is consistently "gaming" the tenders in other countries and you ban them from bidding it leaves only one other supplier who could effectively decide the price. At which point is the lower quality supplier that much worse in terms of overall cost longer term?