As part of our series of blogs on the 2015 Procurement Regulations, we are going to look at the main changes to the two common stages in procurement – the PQQ stage in this blog and in a couple of days we will look at the ITT stage. It is important to know what changes you can expect and how you need to prepare for them if you are a supplier to the public sector.
The most important changes to the PQQ stage in the new regulations are:
A turnover cap has been introduced to facilitate SME participation. Contracting authorities will not be able to set company turnover requirements at more than two times the contract value, except where there is a specific justification. This will be of benefit to a lot of suppliers but given the point made in our previous blog about contracting authorities not being mandated to break contracts down into lots this means you must have a turn over circa £223K (unless the contract is being broken down into lots) which will still inhibit a lot of smaller or newly established companies from competing. In any case, from today make sure all contracts you are applying for follow this rule to open up as many doors as possible. If the turn over requirement is more than two times the contract value then ask why – there may be justification but it might just be an error that the procurement team can rectify, giving you the opportunity to compete for the business.
A much simpler process of assessing supplier credentials will be rolled out, involving greater use of supplier self-declarations, and where only the winning bidder should have to submit various certificates and documents to prove their status. It is thought that the UK will implement the European Single Procurement Document (ESPD) in most circumstances – see Regulation 59 for more details. The ESPD covers most of the ‘standard’ PQQ questions (Company Info, Accounts, Technical Ability etc.) and it is intended that suppliers will be able to re-use the same form where possible to further cut the administrative burden of bidding. The final copy is not available yet but we will bring it to our blog subscribers as soon as it is.
New mandatory exclusions include any offences classified under the terrorism and serious crimes acts and poor performance under previous contracts is explicitly permitted as grounds for discretionary exclusion. Time limits for the exclusion of suppliers should be set at not more than three years for discretionary exclusions and five years for mandatory exclusions. Suppliers who have been excluded from public procurement for bad practice can have the exclusion ended if they effectively “self clean” but this is down to the individual contracting authority to decide and for you to prove you have made amends for previous mistakes.
So while there have not initially been a great deal of changes to the PQQ stage, the introduction of the ESPD could arguably be one of the biggest changes to be seen in in public sector procurement. Working with suppliers through our training courses and consultancy services we constantly hear that companies are frustrated filling out tender documents that all ask for the same information but in a slightly different way requiring a full rewrite of stock answers and information.
Could the 2015 Public Contracts Regulations be the remedy to these frustrations? With the introduction of 100% electronic procurement by 2018 and the ESPD could we potentially be heading towards a future where applying for a PQQ would be a matter of a couple of clicks rather than a couple of days worth of work?
Lets hope so as this will free up suppliers to concentrate on producing high quality and well though out solutions for the ITT stage which will be a welcome benefit to contracting authorities and tax payers alike. We will bring you further details of this as they become available.
NOTE: This blog is designed to look at the most impactful changes and is not a comprehensive review of the new regulations in full, it is important to note that these may not apply to contracting authorities in Scotland.