1. An Introduction to Procurement
Susan O’Connor, PRT

2. What is procurement?
“Act of obtaining or buying goods, services or works from an external source”
external source

3. Public Procurement Rules
Treaty on the Functioning of the EU (TFEU).
The key principles which should underwrite any approach to procurement are:
Non-discrimination
Equal Treatment
Transparency

4. Public Procurement Rules
The main regulatory mechanisms that govern public procurement are:
EU Directive 2014/24/EU
Public Contracts Regulations 2015

5. Which contracts are covered?
WORKS
CONTRACTS
SUPPLY
SERVICES
General building and civil engineering works. Includes execution and design
(e.g. buildings, highways, pipelines, demolition, building completion, plastering etc.)
Includes purchase or hire, and any siting and installation of goods/supplies
(e.g. reinforced doors, IT equipment, baked beans, etc.)
Fully regulated services
(e.g. architectural and design services)
“Light touch” services
(e.g. legal, educational, health and social services)
Subject to full requirements
Subject to “lighter touch” regime
Mixed services – defined by greater value of consideration
Mixed contracts (e.g. “works and services”) defined by “the main subject matter”
Works contract: a) a contract for the construction or design of a work or works for a procurer; or b) a contract where a procurer engages a person to procure the construction, or design and construction, of a work corresponding to the specified requirements for the procurer.
Supply contract – a contract for the hire or purchase of goods.
Services - contract under which a procurer engages a supplier to provide services. Light touch regime – still need to abide by the general treaty principles, with an award notice published to the OJEU

6. OJEU Financial Thresholds
SERVICES
SUPPLIES
WORKS
Central Government
£106,047
£4,104,394
Other contracting authorities
£164,176
Light Touch regime: Services
£589,148
Total estimated contract value excluding VAT

7. What isn’t caught
Sub-threshold contracts
Purchase of land or existing buildings
Employment contracts
Utilities (may be caught by the Utilities Regulations)
Telecommunications networks
Secrets and other security measures
As always –
check the Regulations

8. Sub-threshold Contracts
When a contract falls below the financial thresholds, public sector bodies can follow their own procurement strategies and in-house processes, as long as they ensure that they advertise their opportunities in such a way that is sufficient to enable the market to be opened up to competition.
Transparency obligation is being interpreted widely
The trend of case law is to find against authorities that have not give enough information to bidders
Evaluation criteria should always be disclosed in advance, including sub-criteria and weighting
The Authority can withhold certain information about how it intends to evaluate bids, otherwise it will be giving bidders the answer
DO NOT artificially split larger requirements into smaller units to avoid the aggregation rules and thresholds. This could be judged as an avoidance of the aggregation rules.
Non-discrimination
Equal Treatment
Transparency
True
False ✔

9. Heritage Lottery Fund - Procurement Guidelines
You must get at least three competitive tenders or quotes for all goods, works and services worth £10,000 or more (excluding VAT) that we have agreed to fund.
For all goods, works and services worth more than £50,000 (excluding VAT), you must provide proof of competitive tendering procedures. Your proof should be a report on the tenders you have received, together with your decision on which to accept. You must give full reasons if you do not select the lowest tender.
You must get at least three competitive tenders or quotes for all goods, works and services worth £10,000 or more (excluding VAT) that we have agreed to fund.
For all goods, works and services worth more than £50,000 (excluding VAT), you must provide proof of competitive tendering procedures. Your proof should be a report on the tenders you have received, together with your decision on which to accept. You must give full reasons if you do not select the lowest tender.

10. Running a procurement exercise
PQQ
ITT
Historic
Future
Capability
Solution
Capacity
Cost/Price
Experience
Qualification
Reference
Financial Standing
Two stage process – first stage is Pre-Qualification in which anyone can participate
Minimum 5 contractors invited to tender
Basic minimum timescale from advertisement to PQQ closure
Basic minimum timescale of 30 days from issue of invitation to tender (ITT) to tender receipt
Can be cut to 10
No Pre-Qualification – straight to tender process in which anyone can participate
Basic minimum timescale of 35 days from advertisement to tender receipt
Possible to cut to 20, or even 15
Most suitable for contracts where the subject matter and the award criteria are fairly simple
Restricted Procedure
Open Procedure v

11. ESSENTIAL Seek legal advice Read the Regulations Conclusions
Public Sector Procurement is:
Bureaucratic
Process driven to ensure probity and an audit trail
Legalistic
Driven by EU Directives and UK Regulations
Slow
Up to 9 months
Dangerous
Risky to buyers and suppliers
Flawed
Aimed at promoting competition and procedural conformity, not necessarily value for money
ESSENTIAL
Seek legal advice
Read the Regulations