Search in Features

Clarity begins at Holyrood: new Bill aims to support the ‘Scottish Model of Procurement’

Tuesday October 29th, 2013

The Procurement Reform (Scotland) Bill (the “Bill”) was introduced in the Scottish Parliament on 3 October 2013 with the aim of establishing a national legislative framework to support the ‘Scottish Model of Procurement’. The Bill proposes a set of general duties for contracting authorities in respect of their procurement activities; specific measures to promote good practice; and provisions for Scottish Ministers to issue guidance in some key areas. This briefing note outlines the key features of the Bill.

Jill Fryer

Jill Fryer

Current Procurement Legislation

Public procurement law is a devolved matter and the current legislation in force in Scotland is the Public Contracts (Scotland) Regulations 2012 (the “Regulations”). The Regulations apply to specific contracts which are not subject to an exclusion within the Regulations and whose value is more than the specified threshold. The threshold values are set at EU level and are currently £113,057 for goods and services contracts procured by central government bodies; £173,934 for goods and services contracts procured by sub-central bodies; and £4,348,350 for works (construction) contracts procured by all bodies. These values are amended every 24 months and are expected to change from 1 January 2014.

The Bill, once enacted, will apply alongside the Regulations rather than replace them. It will apply to contracts whose value is below the thresholds in the Regulations – the proposed thresholds for the application of the Bill are £50,000 for services and supplies contracts and £2 million for works contracts. Thus, a wider range of contracts will be covered by Scottish legislation if the Bill is enacted in its current form.

Key Features

Part 1 of the Bill sets out the scope of its application. One of the main policy objectives behind the Bill is to maintain consistency with the Regulations and, as such, the Bill uses the same interpretation of a contracting authority as the Regulations. This aims to avoid any confusion and provides that any body currently subject to the procurement regime under the Regulations will also have to consider the provisions of the Bill.

Part 2 imposes general duties upon contracting authorities including equal treatment, transparency and compliance with a ‘sustainable procurement duty’. The latter duty should have the effect of promoting economic, social and environmental wellbeing within that authority’s area, facilitating access for SMEs and encouraging innovation from suppliers. Arguably the most crucial change for contracting authorities is contained within this part of the Bill as section 11 provides that contracting authorities with an estimated value of procurement contracts over £5 million for the next financial year will be required to prepare a procurement strategy. Minimum requirements for what is to be included in the procurement strategy are contained within section 11(5) and compliance with the procurement strategy is contained within section 13. Also, under section 14, contracting authorities are required to prepare an annual procurement report at the end of each financial year and both this report and the procurement strategy require to be published as per section 15.

Part 3 imposes a number of specific duties in respect of the publication of contract opportunities and award of contracts on the public contracts website maintained by the Scottish Ministers (Public Contracts Scotland). There are also provisions in respect of community benefits with a requirement on contracting authorities to consider whether to impose community benefit requirements where a procurement exercise has a value equal to or greater than £4 million. A further requirement imposed on contracting authorities is contained within section 30 of the Bill where contracting authorities must keep and maintain a register of current contracts which will be publicly available (a ‘contracts register’).

Part 4 contains the remedies for economic operators where a contracting authority breaches its procurement obligations. The remedies under the Bill are only intended to apply for lower –value contracts within the scope of the Bill and the current remedies regime will continue to apply to contracts within the scope of the Regulations. The remedies are available only in respect of some, not all, duties of the contracting authority contained within the Bill. The only available remedy if a contract has been entered into will be damages (although if the contract has not been entered into, the court could prevent it being entered into). Unlike under the Regulations, there will be no prescribed standstill period or automatic suspension of contracts if court proceedings are raised.

Comment

It is clear that there is potential for contracting authorities to face a number of additional obligations if the Bill comes into force in its current form.

The policy intention behind the majority of the changes is to bring greater clarity to the Scottish procurement process with a positive social impact with increased transparency in increased published documentation. The recurrent provision throughout the Bill giving the Scottish Ministers the power to issue guidance on various aspects should also provide contracting authorities with more information. However, the provisions may act as a double-edged sword by providing additional documentation that contracting authorities must adhere to.

The progress of the Bill through the Scottish Parliament will be monitored closely, particularly in respect of further procurement reform in the shape of new EU legislation expected soon. Ultimately, this means change for contracting authorities with additional practices required to adhere to the requirements of the new regime.

 

Jill is an Associate with Harper Macleod LLP and can be contacted at jill.fryer@harpermacleod.co.uk

Twitter: @HarperMacleod

Facebook: www.facebook.com/harpermacleod

LinkedIn: www.linkedin.com/company/harper-macleod-llp

Website: www.harpermacleod.co.uk

 

Gov Opps training partner, PASS (Procurement Advice Support Service) runs relevant training courses for public and private sector procurement. These include Legal Impact on Public Procurement, Writing a Tender Specification, Preparing Perfect Tenders and Introduction to Public Procurement. To get more info on the courses, click HERE.

Leave a Reply

debug