Seven important changes within the Transforming Public Procurement Green Paper
SPA benefit from regional and national expertise, across several disciplines, from our local team, other teams throughout the UK, and our technical and procurement hub at the LHC head office.
The Government’s recently published Transforming Public Procurement (TPP) Green Paper consultation response shows determination to put alternative assessment scoring front-and-centre over price, to drive both equity and economic improvement.
LHC was one of more than 600 respondents to the consultation, which sought responses to the Transforming Public Procurement Green Paper, published December 2020. This report arrives at a busy time for construction procurement re-evaluation for Government, with ‘Constructing the Gold Standard’ released at the end of 2021 building on earlier guidance in the Construction Playbook, and arriving just before Professor David Mosey’s Guidance on Collaborative Procurement for Design and Construction to Support Building Safety.
But what are some of the changes on the horizon to be aware of? We digested the report to pick out seven important points for the procurement sector – and wider construction supply chain.
1. Consistency, transparency and social value are front-and-centre
The TPP Green Paper consultation response sets out a clear intention to move to more consistent, transparent, and socially-led frameworks.
It delivers a change in evaluation criteria from the ‘Most Economically Advantageous Tender’, to ‘Most Advantageous Tender’. This reinforces the message from numerous procurement policy notes (PPNs) over the past few years alerting contracting authorities of a need to take a more holistic approach to evaluation.
Other changes include the ability to broaden the evaluation scope
LHC has been working hard to increase values-based decision making in our public sector frameworks so we can account for wider social, environmental, and political factors such as SME engagement, social value and net zero carbon, among others.
2. Single set of legislation
The TPP Green Paper is clear that legislative reform will promote the delivery of economic and social objectives and benefits.
It will result in a single set of laws, applicable to all sectors – bar some specific exemptions for utilities and defence – effectively combining the following:
- Public Contracts Regulations 2015,
- Utilities Contracts Regulations 2016,
- Concession Contracts Regulations 2016
- Defence and Security Public Contracts Regulations 2011
Though combining existing legislation will help simplify things, procurement specialists will need to be aware of any inclusions from legacy regulations they may not otherwise have been aware of or needed to adhere to.
3. A new flexibility
The Green Paper looks to consolidate current procurement procedures into three options. One of these is ‘competitive flexible’ – designed to give authorities more freedom to bespoke their procurement procedures and assessment methods to individual contracts.
In principle this will help to simplify the bidder experience, however, care will need to be taken by Contracting Authorities not to create a cottage industry of varying hoops and processes for bidders to work through, creating the reverse of what is intended by this consolidation.
The Government has committed to issuing templates, guidance and case studies to support contracting authorities through the process and deliver positive outcomes. This will be crucial to manage the change, and to deliver on the innovation, and socio-economic, political and environmental benefits the Green Paper aims to ignite.
4. Open for business
In addition to the traditional closed framework type, Open frameworks, a newly proposed alternative, can run for up to eight years, must contain at least two suppliers and reopen at least once during its term to allow new suppliers to apply.
To better understand the value of this approach there are some important details to iron out around the application process and practicalities of managing a mid-term refresh. This includes the issue of how new applicants will be assessed fairly and consistently with existing appointed companies and whether there will be an expectation for those already on the framework to refresh their bids. Practical tools and examples would be welcome to shed more light on the nitty gritty.
5. A DPS re-brand
Dynamic Markets (DM) – formerly known as Dynamic Purchasing Systems (DPS) – may now be used for more complex contracts beyond catalogue items and small contracts, broadening their scope.
DPS has always been associated with speed and simplicity and has strong foundations. LHC Group operates a range of national and regional housing and refurbishment DPSs, where a pool of pre-qualified SMEs and local contractors and suppliers have opportunity for more involvement in public sector contracts.
The confirmation by the Government to expand the scope of a what a DPS can be used for brings it in line with common practice already being seen in the sector.
6. Transparent central debarment
It’s encouraging to read the exclusion criteria will be updated to reflect PPNs and other changes in legislation since the 2015 regulations were issued. The Central Debarment List sets out a new process whereby if a contractor meets any grounds for exclusion, it will be placed on the list and barred from bidding for public sector frameworks for five years.
Organisations will be able to apply for early removal, but, encouragingly, checks will be tighter in future, with exclusion assessments expanded to include individuals and others closely connected with the bidder. There are some outstanding questions about how organisations will be referred, assessed and removed but this should bring consistency to the way the core exclusion criteria are assessed and applied to bidders.
7. Central Digital Platform
The Government intends to implement a central digital platform that will contain a wide range of information – such as supplier database, frameworks, notices, contract performance data – in a single repository. It’s a bold proposal and will give both buying and biddering organisations a wealth of information in a single place. However, the devil will be in the detail and how organisations will be expected to input into this and who will manage the data needs further explanation.
What this all means
The proposed reforms are still a work in progress, with a number of areas requiring further consideration and detail, and we expect more to be confirmed in upcoming legislation and associated guidance, which has been committed to within the response document.
However, the report demonstrates the value of well-run, not-for-profit frameworks such as LHC. We bring our expertise and experience from helping clients deliver more than 700 newbuild and refurbishment projects annually, pooling the experience of our regionally-based client and contractor support teams, as well as procurement and technical specialists within the LHC Group. This helps to unravel complexities and ensure consistent, social value-led framework development and management.