Public sector procurement may see ‘lotteries and ballots’ become commonplace

We've now featured several aspects of the initiatives around supporting smaller firms (SMEs) who compete for UK Govenrment work.

One potential result of the wider advertising of contract opportunities (including the new Contracts Finder), and possibly doing away with PQQs, may be huge numbers of suppliers bidding - either at PQQ stage or directly at tender stage if the PQQ is elimiated through wider use of the 'open' procedure. Will headcount-restricted procurement functions be able to cope?

One outcome I fear therefore might be greater use of 'lotteries and ballots', which are amazingly, allowed under EU procurement regulations. My understanding is that, as long as you inform bidders they may be used when you advertise the contract, you can use random selection to reduce the number of bids down to a manageable number.

So if you receive 200 PQQs, you could use a ballot to select 20 and choose your short list from those 20. If you don't find enough that are acceptable, you can then hold another ballot to choose a further 20 to look at. The others go straight in the bin.

It sounds a dreadful methodology to me, both from a point of view of unfairness and time wasting for suppliers, and ultimate value for money for the taxpayer. But there is a very distinct possibility that we will see this technique being used more over the next few years.

And here's Dilbert's take on it (not as negative as mine perhaps...) Thanks to 'bitter and twisted' for finding this!

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Voices (4)

  1. David Pidsley:

    The reference document reads:

    “Shortlisting may be done by way of an objective
    method such as drawing lots rather than by applying
    criteria relating to financial standing and technical

    Peter, thanks for posting this. You may be interested in the question I posted, asking “How does a government’s performance and the size & legal structure of its suppliers change over time?”

  2. Peter Smith:

    The regulations talk about selection based on “objective criteria indicated in the contract noitce”. My understanding is that drawing lots IS an objective criteria! That was confirmed to me verbally a while back by OGC. And here’s a link to a Pinsent Mason newsletter – see page 3 ‘shortlisting’.
    I’m not recommending it as a process mind you!

  3. Phil Adams:

    Hi Peter,

    Fascinated by your comment, I’ve never seen anywhere in the regulations or the directive that allows for the use of “lotteries and ballots” and I would be grateful if you would point me in the direction of this information.


    Phil Adams

  4. Rob:

    As one of the cornerstones to a major transformation programme, I’ve just presented a business case to my CEO and Group FD which incorporates a ‘break-through’ development in procurement and supply chain.

    Essentially, it outlines the requirement to discontinue with the e-sourcing module within the company-wide ERP system, and replace it with a tombola.

    Imagine this. You invite as many suppliers as possible, from the market in which you want to source your requirement, to the procurement launch event. Instead of delivering to them a best practice ‘market engagement’ presentation, you present each of them with a number, and if their number comes up, they can bid.

    As you might expect, you wouldn’t want to the Head of Procurement to duck any of their leadership responsibilities, so they’ll be on the stage, cranking the handle, and calling the numbers.

    Imagine the savings on software upgrades!

    After a number of events, understandably, the Head of Procurement may suffer from RSI, but they could always outsource this key process to McKinsey.

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