Public Contract Regulations 2015: The use of PINs in the restricted procedure

Under the new regulations there has been a change in the way a Prior Information Notice (PIN) can be used by sub-central contracting authorities in the restricted procedure and this blog will take a look at the change and what impact it has on this procedure.

In short a PIN can now be used, by sub-central contracting authorities, as a means of calling for competition in place of a contract notice (Regulation 28) and can also be used in place of a PQQ stage with selected suppliers being taken straight to the tendering stage. This is in addition to the traditional use of a PIN which is to notify the market of a possible opportunity so, under the new regulations, the PIN has a dual function. If the PIN is being used as a call to competition it must contain the information outlined in Annex V Part B I and II in the 2014 Procurement Directive. In summary the PIN must contain standard information such as: Continue reading “Public Contract Regulations 2015: The use of PINs in the restricted procedure”

‘Part B Services’ verses ‘Light Touch Regime’

Under the new regulations ‘Part B services’ have been abolished and replaced with the new ‘light touch regime’. Below we cover what the new rules are, what has changed and whether this is a change for the better.

Part B Services: What were the rules?

Under the previous regulations all services were split into two – Part A and Part B. All services fell into one of 27 service categories – service categories 1-16 were Part A and subject to the full procurement regulations whereas service categories 17-27 were Part B and were essentially exempt from the rules (although an award notice was required). The service category that the service fell under was determined by the CPV codes. The purpose of this was to exempt services which were considered to not have cross border interest from the strict EU publication rules. Services are considered to not have cross border interest when it is unlikely that a service provider in one country can (or will be willing to) provide their service in a different country – for example, hotel services or legal service.

However, part B was occasionally taken advantage of and notices that did have cross border interest were incorrectly excluded from the rules. This was often due to the use of service category 27 which was “Other services” and covered any service that did not fall into the CPV codes listed under any of the other, more specific, service categories 1-26.

Light Touch Regime: What now?

When reviewing the legislation it was deemed that services with no cross border interest do still need to be treated differently however, much discussion took place to determine WHICH services were to be considered to not have cross border interest and WHAT the rules would be. Continue reading “‘Part B Services’ verses ‘Light Touch Regime’”

Contracts Finder – Friend or foe?

  • What is Contracts Finder?
  • Why do Contracting Authorities in England have to publish on Contracts Finder?
  • How do you publish to Contracts Finder?

Have you asked yourself any of these questions? This short blog will provide the answers.

About Contracts Finder:

Contracts Finder was first launched in 2011 by the Prime Minister as an online tool displaying the details of public contract opportunities and contracts above £10,000. The launch was a step by the government towards creating a more transparent system that removes obstacles and provides better access to contract opportunities for small businesses.

With the Public Contracts Regulations 2015 coming into force in the UK on the 26th of February, a BETA version of the new Contracts Finder was launched. It is intended that the new Contracts Finder along with the reforms recommended by the Lord Young’s report, introduced within part four of the Public Contracts Regulations 2015 is the governments next step in providing smaller businesses (SME’s) and voluntary or charitable organisations (VCSEs) with easier access to public contract opportunities and improve transparency. Continue reading “Contracts Finder – Friend or foe?”

Key points from the pre-election Budget March 2015

The key points from today’s Budget

The Chancellor of the Exchequer, George Osborne, today delivered his final Budget statement ahead of the General Election in May.

George Osborne

The key announcements included:

  • The UK economy grew by 2.6% in 2014, with growth forecast at 2.5% for the year ahead. In addition, employment has reached record levels, trade deficit figures were described as “the best for 15 years” and living standards were reportedly higher than in May 2010, according to the Office for Budget Responsibility (OBR). Inflation was projected to fall to 0.2% in 2015.
  • The deficit has been halved since 2010 as a share of national income, with borrowing set to fall to £90.2billion in 2014-15 and further to £75.3billion in 2015-16.
  • Plans to cut £13billion from government departments and £12billion from welfare spending.
  • The pension pot lifetime allowance will be reduced from £1.25million to £1million from next year. The law will be changed to allow pensioners to access their annuities, with the 55% tax charge abolished and tax applied at the marginal rate. An additional investment of £25million to support army veterans was also announced.
  • Beer duty will be cut by 1p, cider and whisky by 2p, and wine duty will be frozen. Tobacco duty remains unchanged.
  • A planned increase for petrol duty in September has been scrapped.
  • The personal tax-free allowance will rise to £10,900 in 2015-16 and again to £11,000 in 2016-17. The 40p tax threshold will also rise above inflation, from £42,385 to £43,300. Also on personal taxation, annual paper tax returns will be abolished and a review of inheritance tax avoidance through deeds of variation will take place.
  • A new personal savings allowance – with the first £1,000 interest becoming tax free – and the annual savings limit for ISAs increasing to £15,240.
  • New Help to Buy ISAs for first-time buyers which the government will top up by £50 for every £200 saved for a deposit
  • A tax on diverted profits, to tackle multinational profits being “artificially moved offshore”, will be launched next month. The annual bank levy rises to 0.21%.
  • The supplementary charge on North Sea oil producers will be cut from 30% to 20% and a new tax allowance will encourage investment.

Continue reading “Key points from the pre-election Budget March 2015”

2015 Procurement Regulations – Changes to the ITT stage – What Suppliers Need to Know.

Following on from our recent blog regarding the changes to the PQQ stage in the new 2015 Procurement Regulations we are going to look at what has changed at the ITT stage and what suppliers need to be aware of when tendering to the public sector.

The most important changes to the ITT stage for suppliers are:

1) There is now greater clarity regarding the rules on social and environmental aspects being taken into account in tenders meaning that:

  • social aspects can now also be taken into account in certain circumstances (in addition to environmental aspects which have previously been allowed);
  • contracting authorities can require certification/labels or other equivalent evidence of social/environmental characteristics, further facilitating procurement of contracts with social/environmental objectives;
  • contracting authorities can refer to factors directly linked to the production process.

The caveat to this is that any factors taken into account must be reasonably achievable for all suppliers so as not to favour larger companies or specific methodologies. We would encourage suppliers to keep a check on your key buyers to see what policies they have in these areas and how they are likely to implement these new rules. For example do they have a big drive on apprenticeships or carbon emissions you could support them on? In general it would be a good idea to start gathering data, case studies and evidence of your company’s positive social and environmental impacts to use in your responses going forward as the level of detail asked for in these questions is only going to increase.

2) Full life-cycle costing can be taken into account when awarding contracts; this could encourage more sustainable and/or better value procurement which will hopefully save money for tax payers in the long term. Continue reading “2015 Procurement Regulations – Changes to the ITT stage – What Suppliers Need to Know.”

2015 Procurement Regulations – Changes to the PQQ Stage – What Suppliers need to know.

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. Continue reading “2015 Procurement Regulations – Changes to the PQQ Stage – What Suppliers need to know.”

Contracts Finder

The new UK Public Contracts Regulations came into force yesterday, 26th February 2015. As we’ve commented in other posts on this blog the regulations impose some new statutory obligations on public sector bodies which are designed to increase the number of small and medium sized companies bidding for and winning public contracts.

The two most major changes that are having an immediate impact on public bodies are:

  1. All contracts with a value estimated to be greater than £25,000 (£10,000 for central government) have to be advertised on the Crown Commercial Service website Contracts Finder. This requirement doesn’t just apply to contracts between £25,000 and the European threshold of £172, 514 (£111,676 for central government), it also applies to notices published in the Official Journal (OJEU), so procurement officers will have to enter the information on one system for the OJEU and then on another system for Contracts Finder. To add to the confusion you are not allowed to publish an OJEU notice on Contracts Finder until it has been published in the Official Journal.
  2. The second change is an obligation to make all of the procurement documents available online at the same time as the contract notice is published. The term ‘procurement documents’ is defined quite widely and is intended to include the full tender specification and all the supporting documents, not just a pre-qualification questionnaire, so that any interested supplier can understand the full requirements before deciding to proceed.

myTenders Pro, which is managed by Millstream who also run Tenders Direct, takes the pain out of these two new obligations.

  • Using mytenders Pro to compile and publish contract notices means they can automatically be submitted them to both Contracts Finder and the Official Journal without the information having to be typed in twice and all of an organisations contract notices can be managed and controlled in one easy to use and low cost service (Regulations 106 & 110).
  • Public bodies can also provide unrestricted and full direct access free of charge to the procurement documents from the date of the publication by making them available to download from myTenders (Regulation 53).
  • Suppliers can submit their completed bids in a secure online postbox which allows procurement officers to reduce the minimum timescales of OJEU procurement but also to prepare for the statutory requirement to conduct fully electronic eprocurement (Regulation 22, not mandatory until October 2018).

We first developed the myTenders procurement portal in 2002 and it now powers Public Contracts Scotland, and Sell2Wales as well as introducing electronic tendering in Ireland and Norway with the eTenders and Doffin websites. The system is in regular use by 11,000 procurement officers and more than 140,000 suppliers, so it has been very thoroughly field tested. We take the hassle out of publishing over 10,000 OJEU notices every year for our public sector customers and a further 25,000 notices for contracts under the OJEU threshold, mini-competitions, etc.

Our dedicated UK help desk provides unlimited support by phone or email to both public sector procurement staff and also their prospective suppliers. Our friendly and knowledgeable staff have years of experience and many are qualified to postgraduate level in the policy and law of public procurement.

Our Information Security system is accredited to ISO 27001 and we are a supplier on the Government’s G-Cloud 6 digital marketplace.

If you are a public sector purchasing officer and are interested in finding out how myTenders Pro can take some of the pain out of these new obligations give us a call on 0844 561 0670 or click here to find out more.

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Getting Paid On Time

Although the public sector are generally quite good at paying on time a new requirement in the Public Contracts Regulations is that every public contract must stipulate that payment is made within 30 days£20 notes from the receipt of a valid invoice (Regulation 113).

Perhaps even more importantly any subcontract awarded by the successful contractor must contain the same 30 day payment terms from the contractor to the subcontractor.

This requirement applies to every contract in the supply chain no matter how far removed from the contracting authority.

There are certainly many cases in the past where a contractor at the top of the supply chain has been paid on time, but delays payment to its suppliers which has an adverse ripple effect as the delay increases further down the chain. This new provision should hopefully ensure that such behaviour is a thing of the past.

Public bodies will be required to publish annual statistics setting out the proportion of invoices paid on time, the liability to pay interest and the actual amount of interest paid.

 

Click here to find new business opportunities on Tenders Direct

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New 2015 Procurement Regulations – Will SMEs benefit from the changes?

The official public contracts regulations which govern UK public sector procurement have been published and are coming in to force on the 26th February 2015.

One of the main aims of the regulations and their precursor strategies ( such as Europe 2020 and the Lord Young report) was to encourage more participation from SME companies in tendering exercises and ultimately to get more SMEs supplying to the public sector.

The current government set the lofty target of 25% of government spend going to SMEs by 2015, a target which is a long way from being met so the key questions for organisations looking to supply into the public sector in light of the new regulations are 1) What has changed? and, more importantly, 2) What does this actually mean for me?

What has changed?

Some of the more significant changes in the new regulations are:

 

  • Tendering documents have to be available from the date of OJEU advertisement – no more registering interest and chasing for updates from the contracting authority.

 

  • Reduced timescales for procurement – on average they have reduced timeframes by a third and have introduced the new Accelerated Open procedure for OJEU tenders and have prohibited the use of a PQQ stage for low value contracts.

Continue reading “New 2015 Procurement Regulations – Will SMEs benefit from the changes?”

Small firms given fighting chance to win Government contracts

Today’s Telegraph includes an article about the new Public Contracts Regulations 2015, which will come into effect at the end of this month. As well as implementing the European public contracts directive (Directive 2014/24/EU), these new Regulations introduce a number of measures, collectively known as the Lord Young Reforms, that aim to help small firms win more government contracts.

One of these reforms, the removal of the pre-qualification questionnaire (PQQ) process, while undoubtedly well intentioned will instead significantly and adversely affect the ability of small firms to win public sector contracts.

All firms being considered for a government contract will still require to be qualified, e.g. to have adequate financial strength, appropriate levels of insurance, quality management processes and a track record of having successfully completed similar contracts. The ban on PQQ’s, simply moves the qualification process from a separate preliminary stage and instead embeds it in the first stage of the full tender evaluation.

This means that instead of completing a relatively short questionnaire to demonstrate their qualifications, a candidate for a public contract will have to provide exactly the same information as part of their tender, but will also have to complete a full tender proposal. A full tender proposal will often consume a very significant amount of time and resources.

If a company would have failed the qualification exercise under the PQQ system they will still fail, but the process will have cost them much, much more. In my view it is inevitable that over time this will lead to far fewer small companies submitting tenders for public contracts.

There will also be a much greater cost imposed on the public bodies who are evaluating the tenders submitted. Instead of evaluating perhaps 5 or 10 tenders from qualified candidates, they will have to carefully evaluate all of the tenders that are submitted to them.

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