Our comments on UK proposed changes to EU procurement regs (part 1)

We've been covering the UK's proposed changes to  the EU procurement regulations, and we featured here the Procurement Policy Note (PPN) that has been issued. We explained that Francis Maude wants public procurement staff – and others I guess – to lobby for these changes when we get the chance (bumping into EU bureaucrats in Tesco, that sort of thing).

So today and tomorrow we'll give our views on each of the nine "specific changes" the UK is proposing, with our assessment of their general sensibleness, and our view on how likely the EU is to ultimately agreee to the change.

• Raise the threshold for goods and services procurement

Yes, seems very reasonable – the threshold doesn’t seem to have increased for years, and when you’re talking about a 4 or 5 year contract, a threshold of around £100K just seems to catch too many contracts within the whole panoply of EU regulations – OJEU adverts etc.  But the EU may consider that this will reduce the openness by an undesirable amount – they like OJEU ads as they are the most open form of advertising.

Sensibleness rating :      High                      Chance of change:           Medium


• Allow temporary exemptions for employee-led organisations/mutuals

This is a tricky one. And incidentally, isn’t the Tory-led Government’s love of this type of organisation rather strange? All very Kier Hardie and old-fashioned socialism: my north-eastern mining forebears would approve! I can see where they are coming from but it does raise some issues around preferential treatment. Personally, I think there are bigger issues around employee led organisations than public procurement rules (pensions for instance) but I think there is perhaps a happy medium to be negotiated with the EU. However, the EU may be nervous of this sort of relaxation; it may depend on how socialist the EU is feeling!

Sensibleness rating :      Medium                   Chance of change:           Medium


• Improve framework agreements and similar models (eg DPS), with much greater flexibility to add new suppliers.

It would be a great help to be able to do this and would actually open up markets and competition if frameworks weren’t set in stone for 4 years.  So I can see some movement here – but there will still have to be some sort of competitive process, perhaps falling short of an entire full-scale new competition, in order to select new suppliers.

Sensibleness rating :      High                      Chance of change:           High (with constraints)


• Enable faster procurement. Pare-back mandatory timescales to the absolute minimum

Particularly as so many competitions are now run with eSourcing platforms such as BravoSolution, Emptoris and similar, it seems sensible and entirely feasibility to tighten the timescales. But the Commission will want to keep to reasonable periods – you can’t issue a 100 page ITT and ask for it back tomorrow! And there may be a feeling that this will play into the hands of local suppliers who have an inside track on what is going on – which the Commission wouldn’t like - so I don’t think this is a “done deal” by any means.

Sensibleness rating:       High                      Chance of change:           Medium


• Allow procurers much more freedom to negotiate

This seems a great idea but – this way madness lies.  There are good reasons why the public sector is restricted in its ability to negotiate – go and ask a few African countries about the downsides of allowing “negotiation”.  I need to stretch out a bit on this one so we’ll discuss it further in a further post.  And this is one where reading the full UK response document is important; the detailed proposal is not quite as it sounds in this summary headline and in the PPN. So the rating here applies to the high-level statement rather than the detailed description, which is actually less controversial.

Sensibleness rating :      Medium / Low              Chance of change:           Low

Part 2 tomorrow...

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Voices (3)

  1. Jim Hemmington:

    We have pushed for a higher threshold at the BBC to help our SMEs, not just in the UK, as we beleive we are seeing a lack of enthusiasm to engage with us from some smaller suppliers, because of costs. We maintain a high level of transparancy of what we buy and would be happy to have this as a condition to pushing up the threshold.

  2. Dan:

    I agree that there does need to be restrictions on negotiating, but a compromise could be reached by extending the use of the Competitive Dialogue process – currently only really used for highly complex procurements (some time ago, the OGC issued a guidance note warning people to stop using it so much…).

    I think this would have the happy benefit of cutting expenditure on consultants that are currently employed writing specifications…

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