Procurement Bill – The journey so far

The Procurement Bill moved to the Report Stage in the House of Commons on 22 February 2023. The Bill’s journey so far has been far from plain sailing. The Bill spent seven months in the House of Lords undergoing what the Lords observed may even be a record number of government amendments. The Lords were confident that the Bill was better when they handed it over than it was at the start. However, it has gone through further scrutiny and amendment in the House of Commons to date with a number of fairly significant amendments introduced by the Public Bill Committee. There are likely to be further changes before it finally receives Royal Assent.

What are the changes?

The current version of the Bill is available here. Whilst there have been hundreds of amendments, many of these derive from changes to terminology and definitions which permeate through the entire Bill. Other substantive changes have been made to resolve practical issues or to further particular objectives. We touch on a few of the changes here to provide a sense of the Bill’s development.

Definitions and terminology

These changes have generally been made to make the Bill more user-friendly and to aid clarity around the application of the provisions.

• A welcome change was made early on to define the alternative to the open procedure, described as “such other competitive tendering procedure as the contracting authority considers appropriate for the purposes of awarding the public contract”, as the “competitive flexible procedure.”
• In the latter stages, a term of “covered procurement” has been introduced to create a distinction between any procurement and procurements that are covered by the majority of the provisions of the Bill (generally speaking those which are above threshold and not exempt). This distinction has meant changes could be made to the drafting of other provisions to clarify that they apply to one or the other.  For example, contracting authorities are only required to have regard to the principles and objectives in Part 2 in respect of covered procurement.
• The definition of contracting authority, and related definitions of public authority and public undertaking, have also been changed to ensure that bodies which operate on a commercial basis are not caught because of their relationship with public authorities.

Closing potential loopholes

A number of the amendments address unintended consequences of the original drafting. An example of this is the addition of a timeframe for any voluntary standstill period. Such a period may not be less than eight working days, bringing it in line with the mandatory standstill period and removing the possibility of a day-long voluntary standstill period offering protection from set-aside.

Similarly, changes have been made to require authorities opting to undertake pre-market engagement to publish preliminary market engagement notices or to justify not having done so in the tender notice (rather than this being a discretionary notice).

The Public Bill Committee has also introduced provisions around disregarding tenders which the authority considers to be abnormally low for the contract. These exist in the current rules but were originally missing from the Bill.

Furthering the aims and objectives of the Bill

Other notable changes include those made to specific provisions to better achieve the original aims of the Bill, creating a simpler, more transparent system which will more effectively open up procurement to small and medium enterprises.

• The threshold for publishing contracts and modified contracts and for setting and publishing KPIs has been raised from £2 million to £5 million. This is in order to balance the objective of increased transparency with the administrative burden associated with authorities having to take these steps (especially redacting contracts).
• In respect of both covered procurements and regulated below threshold procurements (which are those procurements for below threshold contracts which are not otherwise exempt) there is now an obligation on contracting authorities to have regard to the fact that SMEs may face particular barriers to participation and to consider whether those barriers can be removed or reduced.
• The online system for notices, documents and information will be put on a statutory footing with new provisions introduced into the Bill requiring the Minister of the Crown to establish and operate the platform with access to the materials available free of charge.
• The debarment list, which will be hosted on the online platform, has also been the focus of a number of the amendments. Changes have been made to clarify that each entry on the debarment list relates to one exclusion ground meaning a supplier could be on the list for multiple breaches. The amendments also provide for a “debarment standstill period” and an interim relief mechanism in the event a supplier wishes to challenge a debarment decision.

What happens next?

The House of Commons have further opportunities to debate and amend the Bill in the remaining stages before the Bill receives Royal Assent. At that point draft secondary legislation will be introduced and guidance prepared fleshing out much of the practical detail. There will also be a notice period of at least six months before the Act applies on the ground. The current indication is that this will not be until early 2024 at the earliest.

The procurement team at Bevan Brittan are closely monitoring the Bill’s progress and will keep you updated on further developments. If you would like to discuss the Bill and what it means for your organisation please do get in touch.