The Procurement Bill (announced in the Queen’s Speech) was formally introduced to the House of Lords on 11th May 2022 via the 1st reading stage with a 2nd reading, when members of the House of Lords will debate its key principles being timetabled for 25th May 2022.
This Bill is viewed a high priority for the UK Government as it is viewed as a “historic opportunity” for the UK to modernise and develop its own public procurement regime in the light of the UK’s exit from the European Union, free from the existing complex regime which is derived from European Union law.
It should be noted that the new procurement regime is to be applied to procurements run by public bodies in England, Wales and Northern Ireland but that the Scottish Government has indicated that it will not be implementing the new UK procurement regime for devolved bodies in Scotland (public procurement being a devolved matter).
Content of the Procurement Bill
The Procurement Bill covers many of the areas that were highlighted by the UK Government’s Green Paper ‘Transforming Public Procurement’ published on 15th December 2020 and response to a public consultation on the same published on 6th December 2021, on 6 December 2021. Some key areas to note include:
- legal principles and objectives of transparency, non-discrimination, equal treatment of suppliers, value for money, maximising public benefit and integrity;
- increased transparency obligations throughout the procurement lifecycle;
- consolidation of existing regulations into a single. simpler framework;
- sector-specific features and carve-outs to be retained e.g. defence and security procurement, utilities procurement;
- streamlining of procurement procedure into three:
- open procedure;
- other competitive tendering procedure; and
- direct award;
- increased focus on planning of procurements and pre-market engagement;
- Ministerial power to make regulations to provide for direct award when action is necessary to protect human, animal or plant life or health or protect public order or safety;
- refresh of exclusion grounds, including widening of discretionary grounds for previous poor performance and extension to apply to individuals and entities to which a bidder is ‘connected’ (including by reference to the level of control over the bidder);
- central debarment list and supplier registration;
- new Dynamic Market to replace existing dynamic purchasing systems with applicability to all procurements, not just ‘off-the-shelf’;
- open and closed frameworks;
- debrief letters replaced by an obligation to provide participants with an ‘assessment summary’ relating to the successful bidder(s) and their own bids before publication of a contract award notice;
- mandatory publication of contract change notices;
- provisions to assist with the amendment of complex contracts (e.g. by reference to ‘known risks’);
- automatic suspension of procurement not to apply where a challenge is brought after the end of any standstill period;
- new rules on ‘regulated below-threshold contracts’; and
- protection from discrimination for ‘treaty state suppliers’ (e.g. by reference to the GPA and various Free Trade Agreements entered into by the UK Government post-Brexit).
Other Queen’s Speech legislative announcements that impact on public procurement
A couple of further Bills were also announced in the Queen’s Speech which will have an impact on the public procurement regime in the UK as follows:
- Boycotts, Divestments and Sanctions Bill – this new legislation is intended to prevent public bodies from conducting their own boycott campaigns against foreign countries or territories where these are inconsistent with UK Government policy and sanctions measures. Briefing notes expressed particular concerns about the rise of antisemitism in the UK; and
- Trade (Australia and New Zealand) Bill – as the name implies, this legislation is intended to ensure that the UK can comply with its obligations in Free Trade Agreements negotiated with Australia and New Zealand.
What happens next?
As is often the case, the devil will be in the detail with this legislation and contracting authorities and potential suppliers alike will need to carefully consider the details of the legislation, including any secondary legislation and guidance from the UK Government as to how the primary legislation is to be interpreted. DLA Piper will provide further updates and support once this information becomes available.
The Procurement Bill will need to pass through the usual parliamentary process before ultimately receiving Royal Assent and becoming an Act of Parliament. The UK Government has also committed to a period of 6 months between the passage of primary legislation and the coming into force of any new regime and has indicated that any new regime is unlikely to come into force until 2023 at the earliest.
Nonetheless, public bodies and price sector suppliers are advised to commence their preparations for the new regime at an early stage to ensure readiness for what may mark a significant shift from current procurement practice in some areas. To assist your organisation to prepare for the upcoming changes, we are planning the first of a series of webinars, to be held in late June, which will consider some of the key practical implications. Further information will be provided in due course.
Author: Andy Batty