It’s nearly all change for public procurement

Whilst the delay may not have come as a surprise, it is understandably frustrating for local authorities who were preparing for and anticipated carrying out their upcoming procurements under the new regime.
Having already updated Contract Procedure Rules/procurement policies and completed the necessary know-how training, local authorities may be concerned that the delayed implementation of the Act could disrupt the change process underway. To assist with keeping the ball rolling, we set out some considerations for local authorities to give thought to when progressing their implementation.

Understanding the concept of ‘covered procurement’

Local authorities need to grasp the new term of ‘covered procurement’ which is defined in section 1 of the Act as ‘the award, entry into and management of a public contract’. Section 11 of the Act obliges contracting authorities to carry out a covered procurement in accordance with the Act. This defined term helps local authorities to understand exactly which provisions apply to above threshold, non-exempted procurements. When carrying out a covered procurement, local authorities must have
regard to the importance of the objectives set out in section 12 of the Act, namely:
a. delivering value for money;
b. maximising public benefit;
c. sharing information for the purpose of allowing
suppliers and others to understand the authority’s
procurement policies and decisions; and
d. acting and being seen to act, with integrity.
Local authorities will be familiar with applying the general principles under the Public Contracts Regulations 2015during the procurement, but this is a significant change. From 24 February next year, it will be necessary for those involved in making decisions for a contract procured under the Act to understand the objectives and consider how evidence can be gathered to demonstrate that the objectives have been fully considered throughout the procurement lifecycle. This is particularly important given
the increased transparency of decision-making via notices under the Act.

To what extent does policy (including social value)
guide procurement decisions?

Social value has been a key part of the UK procurement landscape for some time and it will continue to be pushed to the top of the agenda in the new National Procurement Policy Statement to be published by the new Government. Local authorities may therefore want to use the extra time that the delayed implementation date has given them to consider their approach to social value in procurement. This can be done by:

• ensuring there is a clear strategy and set of social value priorities reflecting corporate policy so decisionmakers can determine which are relevant to the subject matter of the contract;
• including relevant social value priorities in the core requirements, award criteria and contract conditions;
• promoting the use of pre-market engagement to assess the maturity of the market in terms of social
  value and ensuring the published procurement documents capture this information accurately;
• considering how the authority can remove or reduce the barriers to participation for SMEs;
• devising alternative approaches to price in identifying the ‘most advantageous tender’ – i.e. taking a broader approach to assessing value for money, including for example lifecycle costs and through specific and deliverable social value benefits; and
• factoring social value commitments into the assessment of contract performance.

Are you ready for the new notification requirements?

Local authorities will be aware that the Act includes a comprehensive new notices regime. Whilst intended to improve transparency, authorities will be required to publish several notices on the central digital platform from the pre-procurement stage right through to contract expiry and/or termination.

To prepare for the new notification requirements, local authorities and other contracting authorities should consider whether responsibilities are being captured appropriately in policies and/or contract terms and conditions.

For example, under the Act, post-contract award notices will need to be published in each of the following situations:

• where there has been a modification to the contract;
• where a contract has been terminated;
• where the Act requires KPIs to be set and assessment information to be published;
• where there have been breaches of contract or poor performance; and
• to demonstrate compliance with the 30-day payment terms.

To ensure these notification requirements are met, contracting authorities should ensure efficient interaction is in place between the commissioner, the procurement team, the contract management team and the supplier.

Key takeaways

The Act is intended to be both simpler and more flexible, but with this increased flexibility in the procurement process comes increased transparency and conversely more complexity especially post-procurement. Some of the changes under the Act are onerous for local
authorities, hence the need to be prepared. Local authorities should use this time to continue to familiarise themselves with the secondary legislation and guidance documents published to support implementation. If not done so already, arrangements should be made for key personnel involved in carrying out a procurement or decision-making in relation to a public contract to attend a training session bespoke to the authority or as a minimum, enrol in the Transforming Public Procurement learning and development programme.

For more information, please contact Chanel Quigley.

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