One of the most significant proposed changes in the UK Government’s “Transforming Public Procurement” green paper is the replacement of the award procedures set out in the separate regimes for public sector, utility sector and defence procurement. The changes would see the current regime (which many see as complex) be reduced to just three procedures, with the aim of simplifying UK public procurement.

Current procedures

Currently, there are broadly seven main procedures - i) open procedure, ii) restricted procedure, iii) competitive dialogue procedure, iv) competitive  procedure with negotiation, v) innovation partnerships, vi) design contests and vii)  negotiated procedure without prior publication. 

Of these, the open and restricted procedures are most commonly used – however, neither allow for negotiation within the process. The procedures which allow for negotiation only tend to be used for more complex procurements, with the green paper citing that they only made up 10% of all advertised UK contracts (under the PCR, UCR, and CCR) between 2016 – 2018.

The main thrust of the Government’s proposed simplification is to encourage and enable more negotiation and dialogue within the procurement process. By doing so, it hopes to drive innovation and procure solutions that offer better value for taxpayer money.

Proposed New Procedures

The proposed new procedures right across public, utility and defence procurement are:

• The open procedure is to be retained, whilst expanding its availability to ‘suitable defence and security procurements’;
• The ‘negotiated procedure without publication’ is to also be retained with slight adjustment and rebadged as the limited tendering procedure; and
• A new competitive flexible procedure is to be introduced to simplify and replace all the remaining other procedures.

The open procedure - expanded

The proposal is to keep this procedure largely unchanged. As most will know, it is frequently used for simple / off-the-shelf procurements where requirements can easily be defined and the least expensive supplier is required. The procedure is simple but inflexible. It involves the public authority accepting and evaluating tenders from all interested parties and no negotiation is permitted. Although the procedure could be technically encompassed by competitive flexible procedure, its retention as a distinct procedure has been suggested for continuity and familiarity reasons.

The limited tendering procedure - when it is really urgent

The Government proposes to broadly retain the grounds for undertaking a negotiated procedure without publication under regulation 32 of the PCR; however, two alterations/clarifications have been suggested:

• The contracting authority must publish a notice stating that it intends to use the limited tendering procedure to award a contract (e.g. equivalent to a voluntary transparency notice) and provide a 10 day standstill period in all cases, except where there is crisis or extreme urgency, see below.
• The procedure will still be available in cases of extreme urgency brought about by unforeseeable events but, for clarity, it will be made explicit that the procedure can also be used in times of “crisis”. The paper outlines that a crisis might be declared by the Minister of Cabinet Office in the following circumstances:
• “an event which clearly exceeds the dimensions of harmful events in everyday life and which substantially endangers or restricts the life or health of people;
• where measures are required to protect public morals, order or safety; or
• where measures are required to protect human, animal or plant life or health”.

The competitive flexible procedure - a stripped back approach

This procedure is intended to broadly replace most other procurement procedures (e.g. restricted, the competitive dialogue with and competitive procedure with negotiation etc.) and will be similar to the Light Touch Regime (currently only available for procuring social, health, education and a limited number of other services) in that it will have less prescriptive rules. The stripped back process can be summarised as follows:

• The tender must be advertised using a contract notice that outlines the relevant information and requirements regarding the opportunity – this will be published on the new “Find a Tender Service”;
• The buyer must then remain consistent with that advertised process, including the requirements on selection and evaluation;
• The procurement process must remain at all times compliant with the procurement principles and timescales specified in the GPA. For example:
  • It must be non-discriminatory, transparent, open and without conflict of interest or corruption;
  • Suppliers must be given 30 days to provide EOIs and 25 days to respond to ITTs – though there is scope to reduce these timescales in times of an emergency.

The aim of this bare framework is to give commercial teams greater flexibility and confidence to create innovative procurement exercises and more easily develop / negotiate solutions whilst the tender process is live. Such procurements can be carried out under current procedures but the green paper suggests that the additional bureaucracy and requisite technical knowledge of these procedures has led to low uptake.

Will it work?

A key challenge  is enabling access for SMEs whilst delivering  social value through public procurement. Whilst simplification is to be welcomed, will the Government's proposals make delivery on these commitments more or less likely?

These proposals are currently out for consultation.  For those responding to the consultation, responses to the questions must be sent to procurement.reform@cabinetoffice.gov.uk by 10 March 2021.

If you would like to discuss the content of the Green Paper, including the new proposed procedures, please do contact us.