Procurement Update 2019 19 November 2019 Leeds Newcastle | Leeds | - PowerPoint PPT Presentation

Procurement Update 2019 19 November 2019 Leeds Newcastle | Leeds | Manchester

2 Housekeeping SSID - WH Visitor | Password - W@rdh4d@w4y30 Newcastle | Leeds | Manchester

3 Outline • Brexit implications • What the politicians are saying • Frameworks Break • Abandonment, suspension, pausing • Faraday case • Case law update Newcastle | Leeds | Manchester

Brexit 19 November 2019 Tim Care Newcastle | Leeds | Manchester

5 Deal or no deal! Newcastle | Leeds | Manchester

6 No deal • The Public Procurement (Amendment, etc) (EU Exit) Regulations 2019 • The Public Procurement (Amendment, etc) (EU Exit) (No 2) Regulations 2019 Newcastle | Leeds | Manchester

7 Effect • Minimises impact of Brexit on the procurement regime following exit day • Replaces references to OJEU to the new e- notification service called “Find a Tender” • Transfers functions from the EU Commission to the Cabinet Office e.g. setting thresholds • 18 months after exit day further provisions would amend the regulations further e.g. : • conditions relating to GPA • duties owed to economic operators from other states Newcastle | Leeds | Manchester

8 Government Procurement Agreement • WTO confirmed if we leave with no deal, we will join GPA • Substantially replicates EU’s position in relation to other GPA members • How does the GPA work? Newcastle | Leeds | Manchester

9 What about EU case law? • ECJ will no longer have jurisdiction • Withdrawal Act – “have regard to” EU decisions • EU’s purposive approach v UK courts’ strict interpretation Newcastle | Leeds | Manchester

10 If there is a deal? • PCRs are preserved by the Withdrawal Act for the transition period • Procurements launched before the end of the transition period continue under existing rules • Frameworks and DPS set up before the end of the transition period continue under existing rules • What happens at the end of the transition period – what does the Political Declaration say? Newcastle | Leeds | Manchester

11 How to prepare • Think about wording in procurement documents in case Brexit occurs • Force majeure clause • Restrict price changes • Adverse law changes Newcastle | Leeds | Manchester

Procurement Policies – Political Context November 2019 Melanie Pears, Partner, Head of Public Sector Newcastle | Leeds | Manchester

13 Introduction • Procurement is key • Previously reported on various views from think tanks and associations • Lack of specific information whilst we wait for manifestos to be published • Touch on what we know so far:  Conservatives  Labour  Liberal Democrats Newcastle | Leeds | Manchester

14 Liberal Democrats • 2017 – Soft Brexit • 2019 – No Brexit procurement regime remains as is • General policy – central government to facilitate local communities Newcastle | Leeds | Manchester

15 Conservatives (1) • Change of leadership • Johnson’s leadership campaign – July 2019:  Changes to favour UK companies / favoured for Government work  Avoid “great inherited conglomerate of EU regulation and legislation we cannot change”  “Treat procurement differently so as to increase our investment” in nationally important industries like shipbuilding Newcastle | Leeds | Manchester

16 Conservatives (1) • “We tend to apply them [procurement rules] in a particularly onerous way and it might be possible to treat public procurement differently so as to increase our investment in ship building” Newcastle | Leeds | Manchester

17 Conservatives (2) • Protectionist approach • International trade deals generally need GPA membership to ensure access to other markets (USA/EU) • GPA members would need to agree a proficient approach or UK would have to leave GPA • Would reducing competition nationally / locally be best in long term? Newcastle | Leeds | Manchester

18 Conservatives (3) • Trade Bill 2017 – 2019 • 3 elements  Implementation of international trade agreements  Trade Remedies Authority  Collection and disclosure of trade information  “Continued access through GPA” Newcastle | Leeds | Manchester

19 Conservatives (3) • “Continued access to £1.3 trillion opportunities pa” • “Continued access to procurement opportunities in 47 countries” Newcastle | Leeds | Manchester

20 Labour (1) • GPA membership • Protectionist approach below threshold  Local jobs  Local or regional supplies  Local economies • Protectionism controversial in international trade negotiations Newcastle | Leeds | Manchester

21 Labour (2) • Different approach and emphasis • 2017 – requirements for bidders for government contracts:  Full trade union recognition  Compliance collective bargaining agreements  More towards 20-1 ratio lowest and highest paid  Pay suppliers in full within 30 days  High environmental standards Newcastle | Leeds | Manchester

22 Labour (2) • Apprenticeship and training opportunities proportionate to firm size • Full tax compliance • Best practice equal opportunities Newcastle | Leeds | Manchester

23 Labour (3) • 2019 (so far); • Redrawing of priorities for contract bidders’ • People and planet before profit • Possible ban on outsourcing • PFI contracts ‘in - house’ • Nationalisaton Newcastle | Leeds | Manchester

24 Conclusion • No change • Protectionism • International trade Newcastle | Leeds | Manchester

Frameworks 19 November 2019 David Taylor Newcastle | Leeds | Manchester

26 Framework Agreements • Brief re-cap on structure of frameworks • Advantages and disadvantages • Case law update • Case study – background and lessons learnt Newcastle | Leeds | Manchester

27 What is a framework? • Regulation 33 (2), PCRs 2015: • “ an agreement between one or more contracting authorities and one or more economic operators, the purpose of which is to establish the terms governing contracts to be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged .” • Provides a mechanism for one party to place order with another on standards terms • Two types of framework: • simple • complex Newcastle | Leeds | Manchester

28 Basic structure • Framework Agreement: • includes provisions for forming future contracts (“call - off contracts”) • sets out the terms for future contracts • includes management provisions for operating the framework Newcastle | Leeds | Manchester

29 Types of framework • Different options available: • CAs can buy “products” (i.e. goods, services, works) from a pre -established framework • CAs can set up their own framework agreement • Cabinet Office advice encourages CAs to make use of frameworks created by central purchasing bodies where possible • Using multi-purchaser frameworks to share services and increase efficiencies Newcastle | Leeds | Manchester

30 Setting up a Framework • • No specific procurement procedure set out in Limited to 4 years: Reg 33 – but must be procured in • call-offs can extend beyond the expiry accordance with one of the competitive procedures in the PCRs: • call-off contracts: • Cabinet Office recommends using open • do not require a standstill period procedure • do not require a Contract Award Notice • Contract Notices and Contract Award Notices • do have to publish award notice on • Frameworks can be set up by one Contracts Finder Contracting Authority and used by others: • must be clearly identified in the call for competition Newcastle | Leeds | Manchester

31 Calling-Off • Direct award if: • the Framework Agreement sets out all the terms • there are objective conditions for choosing a supplier • If not – further competition: • Framework Agreement should set out the process Newcastle | Leeds | Manchester

32 Why use a framework? (1) • • creates a facility for procurement Can be used when: • the nature of the products to be • no obligation to purchase procured can be established exclusively from a single supplier • a pricing mechanism can be • no obligation to purchase a minimum quantity of products established • no requirement to establish the precise • Advantages: scope of products, or to set a fixed • creates a streamlined and flexible price (just requires a pricing process for procuring products mechanism) • can be used when the requirements are not known at the outset Newcastle | Leeds | Manchester

33 Why use a framework? (2) • Disadvantages: • can create complex contractual arrangements • for simple procurements, FAs can cause avoidable complications – and create avoidable risks: • call-off contract may be inconsistent / incompatible / contradictory to provisions in the FA • may not benefit from economies of scale if awarding individual packages to different providers under a framework Newcastle | Leeds | Manchester