Procurement contracts play an important role in the development of private sector suppliers and ensure that government entities, including councils, have access to the necessary services, goods and materials needed to serve its constituents.
Following the United Kingdom’s decision to formally leave the European Union, new changes have been introduced to existing public procurement regulations, and the broader procurement regime, to create a more transparent, efficient, and simpler procurement process that’s better aimed at meeting the UK’s needs.
Most central government departments would ensure that contracts are awarded based on value for money, competition, and the main objective criteria for each contract. With a more UK-focused procurement ecosystem, the government will help create a more flexible and commercial system that directly meets the needs of the country and provides taxpayers with access to high-quality services.
Procurement Bill
While the public procurement bill is often considered multi-dimensional and oversees a range of dynamic requests, newer regulations are aimed at delivering faster, and more efficient services to constituents.
Support for small and medium enterprises
The procurement bill reform regards the importance of small and medium enterprises (SMEs), creating a more competitive landscape for all private suppliers. Procurement bill changes would ensure that SMEs are equally considered for contracts, and have broader opportunities to compete among other larger corporations.
Value for money
One of the key objectives of procurement is value for money and would require public sector buyers to account for the national strategic priorities. These priorities are outlined in the National Procurement Policy Statement (NPPS) and encourage public buyers to consider the importance of creating new jobs and improving diversity within the public procurement regime.
Mandatory notice period publications
Any public entity or contracting authorities that awards a contract to any private supplier will need to meet their preliminary market engagements and will be mandated to publish notice periods. Previously, there was minimum oversight for this, however, these changes would encourage public buyers to be more transparent, while private suppliers remain informed.
Single procurement regime
New oversight would encourage the consolidation of four EU Directives, into one single regime. This would create a more streamlined process for both public and private entities, and would further promote a competitive marketplace for all UK-based private suppliers.
International obligations
While new changes would dissolve EU Directives, and rather create more opportunities for UK businesses and private suppliers, a new bill would ensure that the UK government meets its international obligations. Public procurement is overseen by international treaties and free trade agreements under the World Trade Organization (WTO), the Agreement on Government Procurement (GPA) and the Trade and Cooperation Agreement (TCA) with the EU.
This would continue to allow private suppliers to conduct business, and trade with international buyers, and ensure that the UK government provides opportunities for domestic suppliers before attaining services and goods from international suppliers.
Changes to the Public Contracts Regulations 2015
New changes to the Public Contracts Regulations 2015 (PCR) have been introduced and have since come into effect on 25 May 2023. While there have been some significant improvements, there are key changes that private suppliers need to be aware of:
Contract valuations
Private suppliers that are not able to value a contract provided by a public entity, will now be valued at the necessary threshold, to ensure compliance with the PCR.
Contract termination
The updated rules will ensure that contracts cannot be terminated in such a way that it circumvents the existing procurement rules. This would ensure that those awarded contracts, will follow through with their duties, and vice versa.
Keep in mind that contracts cannot be terminated based on discrimination, ensure the equal treatment of all suppliers, and that in the event of contract termination, authorities will need to provide transparent decision-making.
Changes to PIN
PIN or Prior Information Notices can no longer be used as a call for competition. This change is applicable throughout all procurement regime practises, and ensures that new suppliers, with a limited PIN history can also be considered for contracts.
New international trade agreements
Since leaving the EU, the government has further strengthened its relationships with foreign trade partners, including two free-trade agreements with Australia and New Zealand. This helps to encourage domestic suppliers to have broader, and more convenient access to international buyers to create more foreign opportunities outside of the country.
Objectives of procurement regulations
Although the proposed reforms has required several years of delegation, and consideration, new public sector procurement regulations outline forward-looking objectives that promote and support UK suppliers, provide transparent practices, and allow the government access to affordable, high-quality services, materials and goods.
Cost effective
A key objective of the new regulation is to ensure value for money. This would encourage smaller and medium-sized enterprises, as they provide affordable services and materials that help to meet the needs of public buyers.
Maximising public benefit
In line with the core objectives of seeking opportunities that provide value for money, public buyers will need to consider tender submissions that directly meet public demand, and can directly benefit UK constituents.
Integral process evaluation
All contracts and tender submissions will undergo stringent evaluation, to ensure the effective management of public funds and procurement of necessary goods and services.
For suppliers, this would mean that the necessary information will need to be submitted during the tendering process to further ensure the prevention of misconduct.
Delivery of national priorities
The introduced changes to public procurement bill will help to deliver broader oversight of strategic delivery of national priorities. This would allow the central government to award contracts to private suppliers that can directly contribute, and provide efficient, cost-effective solutions that meet the priorities of public entities, including local government councils.
Procurement exclusion
Public buyers may exclude private tenders that pose unacceptable risks to the contracting authorities and constituents. Additionally, suppliers may be excluded based on serious misconduct, poor contract management, slow performance, and various other circumstances that can prove a private supplier is unable to fulfil their duties.
Introducing a public debarment list helps to create a more transparent environment, that ensures contracts are awarded to well-managed suppliers, that can provide cost-effective resolutions. Additionally, the updated mandates help to establish a more effective central oversight that promotes a healthy, yet competitive tender ecosystem for private suppliers that meet the demands and needs of public buyers.
Finishing Thoughts
While navigating the procurement regulatory framework isn’t an easy task, updated interventions ensure that small and medium enterprises that can supply sufficient information, and meet the demands outlined in contracts can equally participate in the tender process.
New procurement process regulations further help to promote a Britain-first strategy, that sees the government actively seeking procurement opportunities within the UK economy, and partnering with domestic suppliers. This not only allows the government to fulfil the needs of citizens, but further allows for a more dynamic market landscape, and thriving economic opportunity for all private suppliers.
