Andrew Daly of Hempsons – More on Public Procurement Legislation and Avoiding Problems

At the recent HCSA conference we heard from Andrew Daly, a partner at law firm Hempsons and an expert in public procurement regulations. We covered his initial remarks yesterday – today, more on his specific comments about how to avoid legal challenges.

As he said (and this is great advice), if you know there’s a problem with the procurement process and you’re potentially not awarding the contract to the best supplier… why are you doing it? Stop now!

And assume from day 1 of the process that you will be challenged. Concentrate on the evaluation and debrief processes; they are key. Stay on the front foot, particularly during the standstill period. If the bidder asks questions in that period and gets an immediate response from the buyer, they feel that you know what they’re doing and are less likely to pursue a challenge, so have all the information ready. Don’t give the bidder the opportunity to say they were denied information – give as much as you can at the beginning of the standstill period.

In terms of dealing with challenge letters, do consider extending the standstill period by a few days. That doesn’t cost much in most cases – and if you don’t, you are really saying “put up or shut up” to the supplier. Guidance from the “Technology and construction court” which now deals with procurement challenges says the authority must acknowledge the letter and respond properly – if you don’t, and they do go to court, you will be criticised.

So, in terms of key areas of risk:

  • Specification – compliance with and drafting of e.g. there have been examples of the incumbent supplier drafting specifications sometimes in a way that obviously favoured their own bid. Procurement didn’t even read the spec in one case!
  • Disclosure of evaluation criteria – the buyer must be transparent. Some organisations are still not disclosing all the details of the process, which can lead to a fatal lack of transparency in the court’s eyes.
  • Manifest error in marking – courts don’t re-mark bids in most case, although in a couple of cases they have when they saw “manifest error.” But if the process is not transparent, you have less margin for error, so tell the bidders how you will mark.
  • Level of debrief is a major cause of challenge now. You must explain the characteristics of relative advantage of the winning bid, you must give reasons why a bidder did not win.
  • The moderation process is increasingly coming under legal attack – as in the NHS case we referred to yesterday that Daly was involved with. If multiple people act as evaluators of the bids, moderation brings their views together into a single score. Whoever chairs the moderation process must be effective, and strong enough to stand up to evaluators with strong personalities. “If you need to show a, b, and c to get a score of 4, and the bidder only offers a and b, then they simply can’t score 4” – even if it is a world-leading heart surgeon saying it should be! Daly suggests evaluators get training, and there must be a good audit trail to justify the moderated decision.
  • Use of frameworks and call-offs: the way call-offs will be made needs to be laid out in the original tender. Be careful about any deviation.
  • Regulation 84 report - there is an obligation to create a report on every over-threshold public contract and framework agreement entered into, and to send a copy of this to the Cabinet Office if requested to do so. If a supplier picks up that you haven’t done that, it is another indicator that you are not on top of matters.

So, don’t worry too much, a lot of this is basic good practice and common sense. But in areas like evaluation and moderation, there are some tricky issues – if you’re not sure what you should be doing, ask someone who will be able to help

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