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Procurement

Are you ready for post-Brexit UK public sector procurement?

Last week, the UK Cabinet Office issued a Procurement Policy Note (PPN) reminding UK contracting authorities* that when the UK withdraws from the EU they will no longer be able to publish opportunities via the OJEU Tenders Electronic Daily (TED) system**. New procurement notices normally legally required to be issued to TED will instead have to be issued to the new UK e-notification service, Find a Tender (FTS) which will go live at 23:00 31st December 2020 when the transition period ends.

Fancy a game of snakes and ladders? Following the new FTS guidance

The PPN instructs Contracting Authorities what action they will need to take, which varies depending on which other services they already use. There are also exceptions – mainly if the procurement had already been published, or a PIN issued, on TED prior to 23:00 31st December 2020 – in which case until the procurement is concluded (i.e., awarded, withdrawn etc.), all subsequent notices and stages will still have to be published through TED. The Cabinet Office does suggests replication on Find a Tender as well however.  

The Notice was accompanied by a set of FAQs and a flow chart that wouldn’t look out of place on a snakes and ladders board but, despite initial appearances, is a helpful map of the various scenarios.

But what does this mean for bidders?

If you currently bid for UK public sector contracts, you will need to use the new FTS platform, in addition to any other portals** you are already registered on.

You cannot access the FTS url, or therefore register on the platform, until it launches after 23:00 31st December 2020, but you can access test data outputs, and can also request data for testing from the Crown Commercial Services (CCS) helpdesk.

EU public sector opportunities are unaffected of course, and will still be published on TED.

So get updating those portal spreadsheets, and don’t forget to register on the new FTS.

We have a feeling the CCS helpdesk might be a little busy fielding queries for a while!

*Including Central Government Departments, Executive Agencies, Non Departmental Public Bodies, wider public sector, local authorities, NHS bodies, and utilities in respect of procurements regulated by the Public Contracts Regulations 2015, the Utilities Contracts Regulations 2016, the Concession Contracts Regulations 2016 and The Defence and Security Public Contracts Regulations 2011 (the “Regulations”).

** None of the other public sector platforms (the Cabinet Office lists Contracts Finder, MOD Defence Contracts Online, Public Contracts Scotland, Sell2Wales, eSourcing NI and eTendersNI) will be affected.

Categories
Procurement

Social Responsibility in Bids

An interesting article from Innovators Mag came through on our bids and tenders alert last week, which talked about Socially Responsible Public Procurement (SRPP) and measuring the social impact of public sector procurement.

The article cited a recent report by the European Commission: “Making socially responsible public procurement work: 71 good practice cases”. The report examines how procuring bodies – and, of course, suppliers – can make SRPP visible, through the promotion of a range of factors including “employment opportunities, decent work, social inclusion, accessibility, design for all, ethical trade, and compliance with social and environmental standards”.

From the supplier side, how often are you asked to show how you would promote social responsibility? In our experience, questions in this area are becoming ever-more frequent, and just some of the examples we’ve seen in the last couple of years include asking how suppliers would:

  • Increase employment opportunities in the local area
  • Create apprenticeships for young people
  • Support local charities and underprivileged groups
  • Reduce the supplier’s and awarding authority’s carbon footprint
  • Demonstrate a local presence
  • Demonstrate a commitment to gender and ethnic equality
  • Use sustainable business practices
  • Adopt family leave policies for domestic violence

What we need to do is think outside the box a little – both on the supplier, and procurement sides

The article notes that many suppliers might “find it hard to incorporate a social dimension in their bids”. This may be true, particularly for certain industries which require specialist skillsets or where your product/service may not naturally lend itself to providing social value as a direct output. Supporting charities has often been an ‘easy win’ for companies to talk about, but it is no longer enough. What we need to do is think outside the box a little – both on the supplier, and procurement sides.

Innovators Mag points to a great example of putting this into practice from The City of Helsingborg (Sweden), which hosted a market consultation exercise to share with potential suppliers its aim to create job opportunities and/or internships for the unemployed through its procurement for cleaning services. This was built into the procurement evaluation criteria. Of the six organisations that took part in the market consultation, four became suppliers, and five unemployed people were provided with jobs or internships in the contract’s first year.

The Helsingborg example also shows that it isn’t enough to simply talk about what you do in terms of social value – you have to offer proof. Many procuring organisations also expect you to continually measure and report on your social actions.

With the effects of the global pandemic ongoing throughout 2020 and no doubt into 2021, SRPP will surely only increase as we look to ‘fix’ our economies. It’s definitely time for all parties to think more creatively about how they can give back to our communities through responsible procurement.

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Procurement

A brief history of bidding: the past, present and future

As a bit of a history geek, the joint celebrations this past weekend of America’s independence and 72 years of the UK’s NHS got me thinking about the history and future of bidding (lockdown is obviously taking its toll…) But in all serious, how did bidding for goods and services start? When were the first contracts awarded? And how has the industry grown since?

Given what we know about their civilisation, it probably won’t come as a shock that the first indications of procurement were seen with the Egyptians around 3,000 BC. While there was, of course, no formal tender and award process, the Egyptians used scribes to record and manage the materials used to build pyramids; recording the requirements and monitoring their fulfilment on papyrus rolls. Ancient coins – now often on display in their hundreds in museums – provide a history of the trades that took place all over the ancient world. Where the coins were manufactured, versus where they are discovered, shows us where the supply and demand came from.

Much of the early formal acquisition of goods and services has its origins in military logistics, where the historical custom of “foraging and looting” was taken on by military quartermasters (the term dating from the 1600s) to ensure troops had the equipment they needed. Procurement as we know it was not really recognised until the 19th century, when Charles Babage’s 1832 book, ‘On the Economy of Machinery and Manufactures’ documented the need for a “materials man in the mining sector who selects, purchases and tracks goods and services required”; a central procurement function.

Fast forward to the 21st century. According to BidStats, in the last eight months nearly 41,000 UK public sector contract notices have been issued, with 1,000 contract award notices in the last week alone*. Coming to more prominent public awareness in recent months, the World Health Organisation (WHO) says it awarded over 2,000 contracts in 2019, at a combined value of nearly $90 million – a 200% increase in volume from 2017. And these numbers are from just two awarding bodies/sectors. A total volume and value of bids published and awarded is, unsurprisingly, difficult to tie down – but will no doubt have too many zeroes to be displayed on a normal calculator!

Cities continually reinvent themselves as urban life changes…by offering ever more inventive goods and services

The percentage increase experienced by the WHO is not alone; the volume, and value, of contracts published and awarded will only continue to rise – albeit we will expect to see changes in focus and subject as technology and industry sectors move ever forward, adapting to global needs and aiming to improve quality of life. In his book ‘Triumph of the City’, Edward Glaeser, Professor of Economics at Harvard University, argues that cities continually reinvent themselves as urban life changes; industries (and individual companies) prosper by early identification of these changes, responding by offering ever more inventive goods and services.

No wonder we all love bidding so much – just look at the vibrant, ever-adapting and ever-growing industry we are part of.

*As a side note, other data and graph enthusiasts should check out the Analysis Charts section of BidStats for UK public sector contract notices and awards split by week, region, type, value, sector and CPV code keywords. #LoveAChart

Categories
Procurement

COVID-19 and the fast-track procurement rules

In mid-May 2020, news broke that the UK Government had awarded over £1bn in state contracts outside competitive procurement during the peak of the COVID-19 pandemic.

Under EU procurement rules, any services/supplies contract valued at over €139,000 (£124,400) must be competitively tendered – with an exclusion given for “cases of extreme urgency”. Of the total 177 state contracts awarded during the period from March 2020, 115 were awarded exercising this exclusion to the rules, with the Government awarding contracts for administering COVID-19 tests, the provision of personal protective equipment (PPE) and food parcels, and running an operations room alongside civil servants. Two of the individual contracts awarded were worth more than £200m each.

Of the total 177 state contracts awarded during the period from March 2020, 115 were awarded exercising this exclusion to the rules

Whilst big-name commercial firms saw success through this route, interestingly the fast-track rules did mean that firms which may not normally have qualified through the formal process for a variety of reasons (turnover, size, experience etc.) have been given an opportunity. Take the 16-man pest control company, for example, awarded a high value contract to procure PPE for frontline healthcare staff. As we know, many Government procurements specify a minimum turnover for qualification. Under normal competitive circumstances, would this family firm – said to previously have net assets of £18k – have even got a look-in? The contract award made this firm the Government’s largest PPE supplier.  

The volume and value of contracts awarded via this exclusion route could set a dangerous precedent though, invoking a ‘race to the bottom’ in future tenders where the value brought by quality, ability and experience should legitimately be considered as part of the evaluation as well as the price – our friend the MEAT award. Indeed, both the National Audit Office and parliament’s public accounts committee have said they will evaluate the contracts awarded during this period to ensure they do indeed represent value for money. Confidence will need to be restored in the competitive procurement process once the fast track rules are no longer deemed appropriate.