• UPDATE: Following Design Week’s report, Gentoo Group has now agreed to remove its £100 charge. You can read more here.
An OJEU tender that asks people to pay £100 to submit their application sets a ‘dangerous precedent,’ according to one design group.
The tender, which has been put out by housing association Gentoo Group to procure advertising, design and marketing services, stipulates that an invoice for £100 will be issued once a submission has been received.
It invites applications from small or medium enterprises and a deadline is in place for 6 January. It is not clear whether or not the £100 will be repaid later in the tender process.
One of the consultancies which had considered application is Playgroup. The consultancy’s creative director Steve Cluett says the tender sets ‘a dangerous precedent’.
He says, ‘Free pitching is bad enough but this is just a slippery slope. Not a huge amount of money, but needless to say, on this occasion we will not be taking up their kind offer.’
In an email seen by Design Week, Gentoo Group principal procurement officer Colin Watson says the fee ‘simply helps us cover the administrative costs associated in preparing the tender documents.’
He adds, ‘We have had this charge in place now for a number of years and aren’t the only organisation who adopt this process. If you look at the potential spend over 3 years, it is £1.5m, so a 0.007% charge is seen as a minimal charge.’
Design Business Association expert Simon May, who is also a procurement lawyer says, ‘There is nothing in law to say you can’t do this and it may be that they’re just screening people out.’
May believes that the practice of charging consultancies to submit a tender is, although unadvisable, not unprecedented and he says, ‘When the Central Office of Information was going they did it and we worked hard to get those fees removed.’
Gentoo’s tender requires the submission of credentials and as such wouldn’t contravene any laws according to May who says, ‘If they were asking for a creative pitch and asked the consultancy to pay, there would be an issue of ownership.’
One potential issue May raises could be how much money is being made from these submissions. If there were 100 submissions, that would mean £10,000 had been taken. Gentoo Group was unable to confirm how many submissions had been received at the time of publishing.
May believes that although the tender is not illegal Gentoo Group should seek legal advice ‘simply to work out what their position is as the tender could cause problems and be detrimental for the brand,’ as these kind of tenders are ‘such a rare occurrence’.
The problem could simply be that the people putting the tender together ‘are from a marketing and not a design background,’ says May.
He adds that if there are further stages to the tender ‘one way to run it might be to not cash payments and to give anyone unsuccessful their money back’.