The recently published Green Paper on transforming public procurement sets out how the government aims to speed up and simplify procurement processes in the UK. Alison Richards discusses the key elements of the Green Paper and highlight the practical implications that the changes may have on running procurement processes. Robert Breedon looks at the procurement law implications of the EU-UK Trade and Cooperation Agreement and its implementation of the WTO's Agreement on Government Procurement (GPA).
Transcript
Michael Luckman: Good morning and welcome to the third webinar in our spring ThinkHouse Public Sector programme. This one on procurement follows on from our devolution and Freeport specials, and if you would like recordings on either of those sessions please do just contact us. And just to flag up too that next Thursday we will be running a ThinkHouse with MindApples which is an organisation which specialises in mindfulness, a useful technique that we might want to use to relax and enhance our performance or if we are struggling to cope with the stresses and strains of lockdown, loneliness or home schooling.
It is fair to say that when we ran our spring ThinkHouse programme last year it was our first fully on-line programme and although well received we actually did not think it would become a habit one year later. Some things have changed, I do not need to show the fire escapes any more or to tell you to turn your mobile phones off. But there is some housekeeping. This is a curated webinar, we will be taking questions along the way and afterwards. If you have a question, please raise it with me directly using the Q&A button which you can find at the bottom of your screen and I shall marshal the questions accordingly. The session is in two halves so it is likely you will have some questions half way through. However, some things do remain the same. We do aim to deliver our loyal audience with high quality speakers covering a mixed diet of both regular catch ups and interesting topical subjects that we think impact on your day to day needs or are useful in providing you with wider context of significant legal trends.
So as I say, today's session is on procurement. It is divided into two halves and first we will look at procurement law as it currently applies in the UK; that is following our exist from the European Union. To what extent have the rules really changed and what is the impact of our joining of the World Trade Organisations' agreement on government procurement? After that we will look at the government's recently published proposals for reform of procurement law. The government is currently consulting on its proposed reforms and is hoping to simplify procurement rules and offer greater flexibility.
I would like to introduce you now to our first speaker who is Alison Richards who will give us an overview of the current post-Brexit procurement landscape. Alison is a very senior and experienced lawyer in our commercial and projects practice. As a law firm we are members of the government's major projects panel and Alison has had significant experience on advising on large central government projects most recently in the role out of COVID-19 testing kits and she regularly advises on public procurement issues. Alison.
Alison Richards: Thank you Michael. Yes, so as Michael says, I am going to have a quick look at what the current procurement regime looks like in our post-Brexit era and the extent to which things have or have not changed.
So as you are all aware, on 31 December 2020, the EU / UK transition period ended and on 24 December only a week prior to exit the UK and EU reached agreement as to what the trade arrangements will look like under the post-Brexit regime. Those arrangements are set out in the UK / EU Trade and Co-operation Agreement or TCA. And within Part 2, Title 6 of the TCA along with the annex which is PPROC1, it sets out actually what that means in terms of procurement arrangements. Notably the arrangements expressly incorporate the World Trade Organisation General Procurement Agreement provisions or GPA. So in terms of applicable procurement law we now need to look at the World Trade Organisation General Procurement Agreement, the regulations as we know them so PCR the utilities concessions and defence and security regulations and of course the guidance - I will say a little more about some of the guidance that has been issued and no doubt, as things start bedding down we will expect to see some further guidance. But that is not everything because the government is of course considering changes to the UK procurement regime and Robert is going to let you have a bit more detail about what is going on and what is in the spotlight in the second part of the session.
So before I leave the detail of the TCA entirely, I thought it would be useful just to share how the TCA deals with EU / UK procurement after Brexit. Again, I have referred a couple of times to Part 2, Title 6. The document is a huge document so for those of you that are interested in having a look, if you skip straight to page 148, that is where the 19 Articles start and you can take a look in your own time. So the topics of the Articles look familiar just looking down the list and these are the first ten on this slide, you will note the themes closely follow the principles previously set out in the directives and indeed covered under the procurement regulations. There are very few differences but what I would say is the provisions are not prescriptive, it leaves the detail to be panned out in local regulation. So for example, under PPR03 which talks about the use of electronic means of procurement, rather than going into the mandatory text that you see in the regulations, it requires electronic tendering to be used to the widest extent possible. And in PPR08 regarding selective tendering, the UK has agreed to ensure there is sufficient bids to ensure genuine competition without affecting the operational effectiveness of the procurement system. How would we go about that is left for the UK to decide but of course, in the current regulations, we know that for a different procure is sort of mandates that you need a minimum number of bidders for different procedures. But it does perhaps give some scope of flexibility for change in the future.
Just looking at the next slide which lists the remaining Articles. And again, under PPROC11 the domestic review procedures, this requires each party is to adopt measures to protect the interest of potential suppliers including for example through standstill procedures or allowing for corrective actions where there is a breach of the rules set down. But again, very light tough and the detail is left for domestic regulation. So although fairly high level, the reality though is that the EU and the UK remain bound by the requirements of the GPA. So let us have a quick look at what the World Trade Organisation requires in terms of the procurement agreement.
So in terms of the structure of the agreement, there is 21 parties to the agreement and that consists of some 35 members and although the UK is now a member in its own right, that is little change because of course we were previously a member but that was through our membership of the EU. So the first part is the text of the agreement and it applies to all parties and it includes obligations around open, fair, transparent conditions competition and that has to be ensured across government procurement. And then when you go to the activities covered by entities listed, so that is our equivalent of contracting authorities, they are caught in relation to purchasing the goods and services that are listed in the GPA and when they are above the thresholds covered by the agreement.
Part 2 of the GPA is party specific so there is a UK specific part and it basically lists the entities that are caught within our part of the agreement so our contracting authorities and lists the goods and services as well as our thresholds, any exceptions to compliance and requiring all suppliers to be treated equally and fairly through competition and that of course mirrors what we are used to seeing. The GPA is administered by the committee on government procurement although really the enforcement is via domestic law. There is a World Trade Organisation dispute mechanism but it has been very rarely used in particular in relation to procurement so our own mechanism continues to apply.
This looks at how the UK has implemented the terms set out in both the GPA and the TCA and that of course is via the regulations that we know and love. So we have now implemented the public procurement amendment regulations 2020, again there is a link there, and that revises the existing regulations. But the effect of the changes that have been made are to sort of make fixes, so it fixes the regulations by reflecting the UK's departure by removing references to the EC. It is fixed references to the EU, there are still some remaining where there is a comparison but to the extent it can, it has removed those. It also refers to the new Find A Tender service rather than OJEU advertising and again I will come back to that because there has been some further guidance around that. And importantly it also confirms that the existing ECJ case law continues to bind our courts until it is overturned and that will be either through further legislation or through further case law that overturns previous decisions. And it also confirms that the GPA is the basis for access for EU based economic operators.
So the next slide deals with the transition arrangements and the amendment regulations provide that, for all procurements commenced prior to 31 December 2020, they continue to be governed by the EU Directives. Also noting that e‑certis continues to be accessible for nine months and requirements for reports to be made to the European Commission have been removed and replaced instead with requirements for notifications to be made via the e‑notification service.
Other changes applied a little bit more clarity around the thresholds that apply. So if we pop onto the next slide we can look at the thresholds. They have not changed although regulation 5 has been simplified so, rather than referring to the directives and to Euros, the regulations now expressly state what the thresholds are in Sterling values and they are set out on the slides, I do not intend to go through those. But safe to say that the Cabinet Office going forward is going to be responsible for reviewing and re-valuing those financial thresholds but of course that does not mean there is freedom for all because of course they do still need to align with the GPA thresholds. And we also understand that the first review is due in January 2022 so no doubt towards the end of this year we should be getting notifications letting us know what those thresholds are going to look like.
So then I would like to start looking at some of the guidance that is out there. There has been a few recent procurement policy notes. The first that I will mention is 10/20. They have addressed the changes to the procurement regime post-Brexit and it confirms really much of what I have said this morning around the GPA and treating suppliers fairly and the supplier access to other markets under the Government Procurement Agreement. It also contains some useful guidance in the form of frequently asked questions. And you might want to take a look at that so it goes through maybe eight or nine pages. There are some useful snippets in there.
So the next one, I have mentioned briefly already, is PPN 08/20 which is the Find A Tender guidance. So this is a new service, so it confirms for all procurement launched after 31 December, contracting authorities are required to publish your notices on Find A Tender rather than through OJEU but where a procurement was launched prior to 31 December you still need to continue to publish your notices on OJEU and that includes your contract award notice plus your amendment notices, any core agenda, etc.
We have had a little bit of a chat with clients to see what their recent experience has been of that service and understandably the look and feel of the Find A Tender service is very similar to the OJEU/TED service but you do need to pre-register and you might therefore want to consider doing so earlier so that at the point at which you are ready to start placing new notices, then you have not got the hassle of having to register in that way. That said, we do understand as well that the transitions have been very seamless, the system is working wonderfully and no issues to report which is all great considering it has only been up and running for a very short time.
The PPN also confirms that for contracts awarded under frameworks or dynamic purchasing systems, again, if they were launched prior to 31 December, the old regime applies and they continue to be caught under OJEU so that continues and that includes and extends to call off agreements and contracts awarded under dynamic purchasing systems. If they were launched after of course, you are home and dry so you just stick with the Find A Tender service.
Another couple of things that I have picked up from some of the guidance is, there is a request that, even if you are required to advertise under OJEU, there is a request that you also advertise through the Find A Tender service so that there is only a single portal for UK suppliers. And I also picked up that you still need to continue with contracts finder and there is not a link between the Find A Tender and contract finder at the moment.
So I would like to just mention PPA 11/20. Now it is not directly related to what we have been talking about this morning which is what the regulations look like because it deals with below threshold procurements but it is relevant because it deals with the rules around reserving contracts and allowing contracting authorities to reserve for example SMEs or by specific locations. But it is quite clear that contracting authorities cannot reserve procurements for suppliers in the UK or England, Scotland, Wales or Northern Ireland and it also prohibits reserving contracts if there is a cross-border interest. So this makes it clear that the EU should not be discouraged from participating in UK procurement and that is consistent with GPA obligations that apply to any other parties through the GPA. That message is also reinforced it note in the, I mentioned the frequently asked questions to PPN 10/20, there is a question around that and that confirms we cannot treat Europe any differently to previously.
So that is all I wanted to say about what the regime looks like now, so I will hand back to Michael. Thank you.
Michael: Thank you Alison. We have a couple of questions for you. This one is from Fiona who has been advised that, when referencing what is going on in tender that she should use the PCR 2015 reference, the public contracts regulation 2015 reference. I am just wondering whether instead it ought to be a reference to the amendments, the amended version as opposed to the 2015 version.
Alison: Yes, so the regulations are still valid and it is not wrong to say 2015. As lawyers we tend to take a belt and braces approach and put "as amended" afterwards and I do not think that would be wrong either. So, yes, going forward perhaps that is the takeaway as we say 2015 as amended.
Michael: OK, and there is a question here also around future EU decisions which is, how influential do we think that future EU procurement decisions will be both on UK practice but also on World Trade Organisation practice.
Alison: I cannot see that they will be anything other than influential. So as I said a short while ago, the European case law will continue to apply until the point at which it is overwritten by something or by new law or by new case law. I cannot see that the courts would just disregard any of the rules that persisted prior to our exit until we have substantially different regulations.
Michael: OK, two more questions and then I think we will go into the next session although we can pick up other questions on this session after that as well. A question here around the Scottish public procurement regulations obviously which I know you understand in great detail Alison. Do the amendments apply to those as well do we know?
Alison: There are separate regulations for Scotland. Hands up I did not look to see whether the amendment regulations amend those too. I would have to take that away but I am happy to come back on that.
Michael: Yes we have just got another question come in on Scotland so maybe we ought to do a little bit of BAD after the event on that. And just whilst we have got the last slide up, just a question as to what is the difference between one and three on the last slide?
Alison: Yes of course. What the PPN says is that, if you have got a region of the UK, so there is an example in Birmingham if there is a big event taking place, you might want to reserve certain services for a particular market because of the nature of the service. So it would be fine to ring-fence the procurement as long as there is no cross-border interest in those circumstances but you could not say only UK or England suppliers could apply.
Michael: OK. I think Robert, if I may, I will take this last question because it links in nicely with the fact that we are looking backwards not forwards here. Where if anywhere are the old treaty principles captured for those matters that are below the threshold tenders?
Alison: The below thresholds are obviously not caught by the regulations except of course they continue to be bound by the principles around equal treatment. They are now embedded into the regulations. They reflect the World Trade Organisation requirements which is, that will be why they were in there in the first place, so again, it is one of those examples of where we have had European procurement regulations previously, actually they will reflect our position either previously collectively and now on our own as a member of the World Trade Organisation General Procurement Agreement. So that is "as is".
Michael: OK. Thank you very much. So we have now got our feel for the current landscape. So probably now is the time to, why stand still, let us look forward to the government's proposals for future reform. And the government has recently published a Green Paper called "Transforming Public Procurement" and Robert Breedon is going to examine its key proposals. It talks about obviously, every pipe dream, simplification and speed, a sunny bureaucracy-free upland unleashing procurements potential, is probably how it is snappily phrased. And talking of sunny, Robert is head of our commercial practice and he co-leads with me our government sector team and heads our public procurement group. He has significant experience of advising a wide range of government clients on procurement and commercial issues and his experience includes working actually for quite some time a number of years as legal counsel for central government unit. He will also be sitting on a panel alongside Lord Agnew on the next Whitehall and Industry Group meeting on 11 March and the topic there is procurement after Brexit and we are very pleased to be sponsoring that event. Lord Agnew's team is actually the team that produced the Green Paper that we are looking at this morning and if you would like details and would like to get involved with that, please either contact us or contact Whitehall and Industry Group for further information. Robert, so what is coming down the tracks?
Robert Breedon: Thank you Michael. So just to set out the structure of the next twenty minutes or so. We are just going to look at the background to the Paper and the proposed timetable and you will be pleased to know we are still in time, it is still possible for you to contribute to the debate around the proposals in the Green Paper. And then looking into the Paper itself, we have separated it into two halves really, the process changes, those changes that are proposed around the procedures that we will follow and the regulations and then secondly the important area of litigation and remedies. The UK has the dubious distinction of being the second slowest and second most expensive system in the EU when it comes to bringing procurement law challenges. I have not actually been able to find out who is the most expensive and the slowest but it is not a good place to be, and there are some good examples from around Europe as to how that might be improved.
So if we look first then just at the background to this. Without wanting to re-open all of the debates around Brexit and the wish to leave Europe, it is quite clear that the government, seeing itself free from the shackles and constraints of EU regulation, wanted to overhaul really the UK public procurement regime. The Prime Minister, back in 2019, talked about building a very large bonfire of the red tape that comes out from EU procurement regulations. So some reasonably strong language coming out of that and it flows through into the Green Paper. So there is an extract from the forward there from Lord Agnew. "For too long, modern and innovative approaches to public procurement have been bogged down in in bureaucratic process driven procedures. We need to abandon these complicated and stifling rules and unleash the potential of public procurement so that commercial teams can tailor their procedures to meet the needs of the market." Not often that you hear public procurement and unleashing potential in the same sentence. But there we are, that is a view of the desire and the appetite and the frustration I suppose that some feel with the EU regulatory backdrop. So the aim is there are the second bullet point. Simplification; greater flexibility; an important principle that we will dwell on later around transparency; a slightly different approach to value for money so, rather than just being quality and price, we are looking to broaden that and to bring into play other factors such as social value and environmental issues; and as we have mentioned faster and cheaper procedures for bringing challenges and, in relation to remedies, a much greater focus on pre-contractual remedies. So that is the landscape.
So the paper was issues as we have said there, December 2020. The consultation is still open and we have the ability to respond by 10 March. We will certainly be responding as a firm. I know some of our clients who are on the webinar this morning are also pulling together some of their thoughts and we would be happy if anyone wants to feed into that to reflect your views as part of our own response.
The Paper is to some extent quite high level. There are areas where, as procurement lawyers we are itching to get into the detail, what will the regulation say, and I understand why that is the case at this stage. In a couple of areas it makes constructive feedback on the proposals a bit difficult because you just want to see the details. So we will bear that in mind as we go through.
And the other key factor, of course, is as Alison has just outlined... notwithstanding our desire to radically reform procurement rules we still have to operate within the constraints of the World Trade Organisations GPA. And, of course, at the heart of the GPA is the fundamental principles that opportunities should be advertised, bidders should not be discriminated against, you need to follow a fair and transparent process. So, within that context the Government is looking at what it can do around flexibility and speed.
Some of the proposals are quite bold, particularly around streamlining the process and more transparency. So we are now going to look at the first of the process changes. So the first real change is that the Government is proposing to rationalise and clarify the sets of different rules that we have in place at the moment. So, as you all know we currently have the public contracts regulations, we have got the utilities regulations, the concession contracts and the defence and security regulations. To some extent they are broadly similar, but there are sufficient numbers of differences that each time you come to look at the regulations. You cannot make any assumptions for example that the UCR matches the PCR. So, it does entail a little bit of check and references across and what is being proposed is that we will merge all those into a single set of regulations and the intention is to lift some of the greater flexibilities that we currently have under the utilities and the concession regulations.
Now, they do not go into specifics but to give you an example of a greater flexibility under the utilities regulations, when we get asked to advise on contract modifications, which is one of the most common questions that we get asked on under the PCR. Some of the safe harbours for making modifications are subject to a 50% threshold, so you cannot increase by more than 50% of the contract value. You do not have that in the utilities regulations so that might be an example where Government is talking about greater flexibilities offered by those regulations.
What the Paper also then says, but there will be specific parts of these new regulations that apply to the particular sectors, so defence and utilities. And, I suppose critics of this have said that it is all well and good having one set of regulations but you the supplement it, albeit within the same document, by particular provisions dealing with defence and utilities. So is it really that simplified? And, until we see the detail we will not really know. But, at least we will have just one place to go in terms of looking for the relevant provisions and some of the process and sort of operational matters will hopefully be more consistent across all of those sectors.
So, that is the first of the process changes. The next slide just picks up on a proposed change around the types of procedure that will be proposed. So, at the moment, you will be familiar that we have the open procedure, restricted procedure, for more complex arrangements we have competitive procedure with negotiation, competitive dialogue and we have got the innovation partnership procedure. So lots of different procedures.
The proposal going forward is that we simplify that and essentially we will have two procedures for competitive procedures. The first of those is the open procedure, much as it is today it is going to be used for simpler off the shelf competitions. The sort of one stage process where you invite proposals against a requirement and some contractual terms. You evaluate the bits and you award the contract. The the main change in procedures is the new procedure called the competitive flexible procedure and that will replace the restrictive, the dialogue and the competitive procedure with negotiation going forward.
And the key feature of this procedure, it is very similar to the light touch regime and so contracting authorities will be given greater discretion on how they run the procurement. And those of you who are familiar with the light touch regime - I think will probably welcome this proposal. We do a lot of work in, for example, the health and care sector and the educational sector where they use the light touch regime.
And I think it is quite helpful to be given that greater flexibility and, at its simplest, what the light touch regime says is that opportunities should be advertised. The procedure that you are going to follow and the criteria that you are going to use must be set out in the documentation. Having set it out in the documentation, you must do what you say you were going to do. You need to comply with the underlying principles of fairness, transparency and non‑discrimination and any time limits in the procedures should be reasonable.
So that is sort of high level fair process but, within that, much greater flexibility is to how you might run the procurements. So if, for example, you feel you want the ability to negotiate at different stages, to step down the number of bidders - all of that is into the melting pot, so much greater flexibility and free from the constraints that we sometimes feel frustrated with. For example, no ability to negotiate under the restricted procedure and subtle differences between competitive dialogue and the competitive procedure with negotiations so all of those challenges get removed. So that is the key one to look out for going forward.
The third area on this side in terms of process is what they are now calling the Limited Tendering Procedure essentially this is the direct award ground. The limiting tendering procedure is the language that comes out from the GPA and what the paper says it is largely going to mirror the existing grounds in Regulation 32 so there is only one supplier out there or for protection of intellectual property rights extreme urgency and there is a new ground to be used in cases of crises and so this is very clearly arisen from the events of the last 12 months and the challenges that the public sector has faced in dealing with the pandemic and the need to just get on and award short term contracts to be able to deal with the particular crises that we are facing and so the papers says that government reserves the right to declare a crises which would then free up the ability to use the direct procedures. If they are on a local level then a local crises then the local contracting authorities can apply to the Cabinet Office to say can you declare a local crises which then free up this ground under the proposed rules.
A word on crises and this will come out in the slides when we send we send them out to you. It is proposed that this would be an event which clearly exceeds the dimension of harmful events in everyday life and which substantially endangers or restricts the life or health of people or where measures are required to protect public morals, order or safety or finally where measures are required to protect human, animal or plant life or health so crises could be triggered it would be declared and that would open up the ability for contracting authorities to use this particular procedure for direct awards.
If we go on to the next slide then we have another of the process changes around what the green paper calls Purchasing Tools and here they look at dynamic purchasing systems under frameworks. Of all the areas in the green paper this is the one that is the hardest to follow and indeed Sue Arrowsmith procurement expert describes this section as having a lack of clarity and reasoning on these recurring purchasing mechanisms and that she says makes meaningful consultation in this area a bit difficult. I think I share that because I have read it a couple of times and it is not entirely well developed but the proposal is that we would have a DPS system Dynamic Purchasing System Plus as they are calling it to replace the current DPS. It would have no maximum duration but the duration would need to be set out in the procurement documents. It is a live system, it is dynamic in that sense and suppliers can apply to join at any time and unlike the current arrangement where you are limited to common goods and services sort of commodity type products it could be opened up to a much broader range of services.
What is not entirely clear from the green paper is how you come to call off from the DPS and the proposals in the green paper talk about well having got onto the DPS the way the contracting authority would then work would then be to use the competitive flexible procedure to invite all suppliers on the DPS to put forward proposals now that does not feel at first sight like a streamlining of the DPS arrangements that we currently have so it feels like a sort of accredited list and then you go to all of them with this competitive flexible procedure so I think there is a bit more thinking needed around that.
In relation to frameworks some proposals here probably not a significant change in what we have currently got. The main change here is that for some frameworks the current restriction of four years in terms of duration can be extended. You can go to up to eight years and if you do that you have to open up the framework. Now that is not an always open issue a bit like the live DPS model it is a framework whereby at points in time you would open up the ability for other suppliers to apply to join the framework or indeed existing suppliers on the framework to refresh their proposals in terms of pricing. So the longer a proposal for longer frameworks with the opportunity to reopen the ability to join them at fixed points. Direct awards under frameworks as they are today would be permissible provided that the objective criteria are set out in the framework documents.
And then finally in relation to the process changes, is a theme runs through the paper around political priorities it is very clear that the government proposals say that procurement should be used to underpin and support national priorities government priorities. And so the proposal is that there will be a national procurement policy statement issued by government and that will set out some key principles that contracting authorities will be expected to comply with in running their procurements. Example is given in the paper are there might be a greater emphasis in running procurements on creating new business, new jobs, new skills in the UK and proving supplier diversity or innovation and a supply of resilience or tackling issues such as climate change and reducing waste. So there could be a greater emphasis put on central themes and central objectives around government and authorities would be expected to comply with that as part of their procurements.
I mentioned earlier on in relation to value for money currently you will know that the rules say that when you apply criteria to determine who is your preferred bidder the criteria must relate to the subject matter of the contract and it is proposed that we might broaden that so that you can open up to economic social and environmental outcomes as well as considerations around suppliers records around prompt payment and achievement of environmental targets. So broadening that concept of value for money.
Finally in relation to process changes and this is a significant change in relation to transparency. The paper talks about transparency will be imbedded in our procurement regulations by default so transparency is imbedded by default. Much more requirement to publish information so publishing notices in all but a few cases including for example modifications and variations to contracts. At the moment there is a requirement to issue a modification notice for some contract variations but not all and so there is a much greater push for transparency. Most significantly that final bullet greater publication of information before the contract award and standstill period. So at the moment as a procedure is concluded just before contract award as you know the bidders will receive their debrief letters and we apply a standstill period. At the moment that just says these are the scores you got, these are the relative characteristics.
The proposal is that bidders will get a lot more information, and the paper refers to the sorts of information that you currently pull together in your regulation 84 report so some of the background papers that led to the options around the procurement some of the, presumably a lot more information around why you chose the particular type of procedure you did, more information I am assuming around evaluation and some of the feedback there. So a push for greater transparency and this links into the remedies that we are going to come onto to talk about on how that should streamline the process around seeking remedies if you are unhappy with the outcome and reducing costs. If we have a concern, and we were talking about this within the team yesterday, is might this be a stage now in the process going forward where there are going to be some delays because as a contracting authority on the threshold of issuing all of this information might there be a temptation just to stop and double check and be very careful about what is going out. Knowing that this is the point where the challenges are going to come and we are going to be giving much more information out to bidders than we have traditionally done in the past. So this is going to be interesting to see how this evolves and whether it achieves the desired outcome of streamlining the process reducing delays and keeping costs down. So I think that is going to be an interesting area to watch and of course for suppliers on the webinar this morning this will be invaluable information for us to be able to look at and examine and really get under the skin of the reasons for why the decisions have been made and the bids have been evaluated in the way that they have done.
So the final couple of slides deal with litigation and remedies. So firstly, the proposal is that they set up a new unit within government almost certainly within the Cabinet Office with responsibility for monitoring public procurement and intervention where necessary so this is building upon the public procurement review service that is currently in place it used to be call the Mystery Shopper Scheme so the PPRS will be replace by a new unit with greater intervention powers and the paper unashamedly says this is about driving up standards in the public sector about driving up the standards in contracting authorities so the unit will reserve the right to intervene and say that is just not good practice let us do it differently, let us start again. And when it comes to the remedies itself if you are an unhappy bidder, you are unhappy with the process that has been followed or the outcome the proposal is that we would have a tailored fast track system within the technology and construction core and I think most of us looking at the way the technology and construction core has operated in recent years we think they are doing a good job that it is great to have judiciary that are really expert in and understand public procurement law but it is too expensive and it is too slow and they have looked across Europe and they think that we could do thinks a more streamlined and efficient way and there is an interesting proposal that you might even have some cases just decided on written submissions. There is a particular barbed comment that the advantage of this would save the parties employing expensive barristers. It may explain why some of these proposals have received a bit of a lukewarm response from members of the bar.
A greater emphasis on pre-contractual remedies. I mentioned earlier on before the contract is awarded you have much more information and the ability to bring a challenge at that stage and paper is strong on the remedies at this stage might be well rerun the procurement, set aside the decision, correct the errors where there are obvious errors on the face of what has been disclosed and the paper says there is no reason to assume that damages is the remedy that suppliers are looking for and the paper references a lot of feedback that they have had from the supplier base they have actually, they are more interested in the opportunity to win the bid and secure the contract than they are in recovering damages. So will we see a shift in that remedial landscape which is a way from longer remedial processes and awards of damages to something which is faster and slicker. There is a new tribunal service that is also muted for some smaller claims and the paper says that if the proposals for the TCC do not bring around the benefits and advantages that are proposed then they will push more down into that tribunal stage.
And then our final slide on litigation and remedies is because the emphasis is now on pre-contractual remedies and rerunning the procurement or correcting the errors the paper says there should be less emphasis on damages and the proposal here reasonably controversial I think is that the damages will be capped at the legal fees that you have incurred and the multiple of the bid costs. So by no reference to the profit that a supplier would have earned under the contract and the paper says that is aimed at reducing speculative claims. We can have all sorts of interesting debates about how that fits in with the usual sort of UK law principles of you should be put back into the place that you were so a cap on the available damages that you would recover. There are exceptions for that not surprisingly it would be inappropriate to cap the damages where you do not have the opportunity to challenge the award before the contract is entered into. So if you are into the territory of a legal direct awards crises procurements where no notice has been published then clearly you should be able to come along and if you recover damages they would not be subject to the same cap.
And then a number of procedural points at the end here as a result of the proposals around urgent and crises contracts there will be no automatic suspension if a challenge is brought that would not suspend the contract the authority will be allowed to carry on with the contract that its awarded for dealing with the crises and you pick up presumably as part of a damages claim further down the line but not an automatic suspension for those contracts and as a result of greater transparency, greater information that we will see at the standstill period the sort of mandatory debrief letters that we have got used to will disappear and again the reliance on the greater transparency before the contract award.
So final slide key takeaways from this morning before we open up for some questions. In relation to Alison's section there just a reminder there they need to update the procurement templates that you are using to reflect the updated regulations and some of the terminology such as the reference across to FTS and the finder tender service and in relation to that we would encourage to register for that get on board early rather than doing it the day before you want to get your notice out just so it is all set up and ready to run. And we would encourage you to participate in the consultation process to say the deadline is 10 March you can do that directly as I know a number of you are or if you wish to you could feed some observation and comments through to us..
So I will hand back to you Michael at that stage.
Michael: Thank you Robert. You have stirred up a hornet nest there is a few questions coming your way which is really interesting. I guess a sort of high level question with your experience and also the experience of the people, the very experienced people you are talking to as well. What is your general sense of excitement around the green paper are people saying yes this is at last we have finally got a process we think is going to work or is a bit more muted than that?
Robert: No. I think the proposals have been broadly welcomed and I can see why, I think there is a simplification in they are around, particularly I think the single set of regulations and the reduced number of procedures. I think there is a little bit more, there is a bit more doubt about whether the remedies procedures will really be simplified and speed it up or whether we are just going to find, will we recreate some other dispute process around earlier pre-contractual remedies might we get bogged down in that pre-contract stage, you know, we might just be bringing forward the current debates to a slightly earlier stage in the procurement process that is my slight reservation around that but I think the simplification of the procedures is very welcome.
Michael: Just picking up on the themes one of the questions is indeed do we think challenges are going to not just come earlier in the process slowing the process down perversely but do you think we will just get more of them? Is it easier to challenge?
Robert: Probably, I think that will all turn on the scope of the new tribunal when it is introduced so if you are in smaller claims and it is a fast track procedure then yes. If it is going to be easier and cheaper to challenge then why would not you. I think the counterargument to that is if we are being much more transparent about the process that has been followed and the reasons for the evaluation scores that have been given maybe that transparency will result in a great level of satisfaction or explanation that unsuccessful bidders have and maybe they will feel less inclined to challenge if they are getting the full information because there is no doubt that some, at least early requests for information and informal challenges come from not knowing, not having that full information and a couple of years ago many of the people on the webinar will understand that the TCC put out guidance, encouraged us to be much more open around disclosure of information and this is just taking it to that next stage. I still think there is a tendency to hold back on information because of that worry that it will generate a challenge it may be the case that that greater transparency opens up, gives a greater understanding and therefore it may be that challenges reduce so in theory I could see that it would increase because of the simplicity of it.
Michael: Thank you Robert. I a good exam question here coming from Mark so get pen and paper ready Robert, it is in relation to open frameworks and how they might work and particularly in circumstances if you had several lots with a manageable number of suppliers on each say six. Would you have to open up the application to new and existing suppliers?
Robert: Yes. It is a good question and what the paper says there is that it might be closed for a period of time and in that example that Mark's raised you might have six suppliers on there. When you come to your three, four or five year point whatever it is you have said you are going to open up the framework you need to give the opportunity for not just new suppliers to come on and show that they meet your requirements and are deserving of a place on the framework but also the existing suppliers who might take the opportunity after four years for example to refresh their pricing. The risk of suppliers who are on the framework who do that is that they run a risk of being replaced by the new supplier so you might want to limit the number of suppliers on your framework to six or eight and once that number is determined an existing supplier runs the risk of being pushed off of the framework so it just opens up a bit of a competition at that later stage.
Michael: Thank you Robert. And two final questions just I think sort of finger on buzzer type answers so. Will the replacement to the Mystery Shopper, this is from Fiona, will the replacement to the Mystery Shopper be likely to have the wider authority than the guidance Cabinet Office would currently give?
Robert: Yes. We do not know the detail of it but the paper expressly says that it is building on the current PPRS Mystery Shopper Scheme giving greater powers to intervene. So I think it is going to have that because at the moment what the PPRS does it will contact, so if a concern is raised by a bidder during a procurement process PPRS will contact the contracting authority, it will ask it to explain the process it has followed but it does not have any real teeth beyond them publishing in its quarterly report what it has found. So after the event the authority might find that it has been named in the quarterly report and the PPRS might say we think this better practice might have been followed. Now, in practice of course what happens simply having that conversation can cause the authority to stop and think but I think going forward the new unit as yet unnamed would have actually the power to intervene and direct a change in the process.
Michael: And then probably a great place to finish with is another question from Fiona. In your current view when are the regulations going to come in following the green paper feedback? 2022? Maybe we can have a big launch alongside the Commonwealth Games of these regulations!
Robert: Who knows, I suppose it rather depends on the nature of the feedback they get. If they are getting broad support for it they might well push ahead with it but I would have thought 2022 was a reasonable expectation obviously government has quite a lot on at the moment in dealing with all the stuff post Brexit and the pandemic but there does feel to me as if there is a bit of momentum behind this. It is a topic that gets people quite exercised around the whole bureaucracy and it would be seen would it not as post Brexit one of the key changes that would have been made in terms of the sort of move away from the European influence so I can see them wanting to move ahead with it.
Michael: Yes. Very good point that last one it is quite totemic in that sense is it not.
Robert: Yes
Michael: Just to say if you want to hear Robert talk again, why would you want to, but if you do want to hear Robert talk again he will be speaking with Lord Agnew at the next Whitehall and Industry Group session on 11 March. If you want details of course please contact Whitehall and Industry Group or ourselves and we can send you through and just to remind you that next Thursday we have our MindApples session, if you want a bit of a break from the grind of lockdown.
So it just leaves me now to thank both Robert and Alison for a fascinating look at new law and even newer law coming down the tracks and a big thank you to everyone who has joined us and I hope it has been enjoyable. Thank you very much indeed.
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