1. Speakers: Sarah Thompson and Samantha Pritchard June 26 th 2014 Procurement Compliance and Governance - What you need to know to protect you and your school

2. Introduction Sarah Thompson - Associate, Education and Procurement Samantha Pritchard - Associate, Charities

3. Agenda Procurement and Governance the basics Case studies Questions

4. Procurement – the basics Public procurement itself can be described as the process whereby public sector organisations acquire goods, services and works from third parties. School’s procurement requirements: - School’s financial regulations; - Academies Financial Handbook; - DfE’s Buying Goods and Services – Schools; - TFEU principles; and - EU Procurement Rules/Public Contracts Regulations 2006

5. Procurement – the basics Getting it right is important Best value for school Value for money statement Audit perspective Consequences of getting it wrong

6. Governance – the basics Nolan 7 standards of public life Selflessness Integrity Objectivity Accountability Openness Honesty Leadership Trustee duties and responsibilities

7. Case Study 1 - Financial policy and EU procurement School’s financial policy – General principles -expenditure should reflect best value principles -fair competition through quotations and tenders -ensure contracts are procured in the most economic, efficient and effective way -School’s financial policy – Typical values -Less than £10k -£10k - £40k 3 written quotations -£40k+ (but below EU thresholds) 3 competitive tenders

8. Case Study 1 - Financial policy and EU procurement ICT contract value £80,000 Write a specification to include as part of tender Clearly state what you want quantity/quality/other requirements Does the supplier have to meet any legal criteria? (h&s) Outline standards of performance expected Advertise Local/national newspapers/trade journals School’s/Council’s website

9. Case Study 1 - Financial policy and EU procurement ICT Contract annual value £40,000 – total value? (£40k x 4) + (£40k x 1) = £200,000 EU procurement financial thresholds for schools Services and Supplies £172,514 (excl VAT) Works £4,322,012 (excl VAT) Above threshold purchases must be undertaken in accordance Public Contracts Regulations 2006 Prescribe detailed rules (supplemented with case law) on how the competition must be undertaken

10. Case Study 1 - Financial policy and EU procurement Can you extend the existing contract? What do the terms of the contract state? Is there a clear/unequivocal variation clause permitting an extension? Yes No Careful not to exceed the EU procurement thresholds Can you award a new contract to supplier recommended to you? Comply with school’s financial policy Avoid direct award as difficult to demonstrate best value

11. Case Study 1 - Financial policy and EU procurement Other procurement options Framework Agreements LA PSBO – Crown Commercial Services, Crescent Purchasing Consortium Collaboration with other schools

12. Case Study 2 – Maximising income Trading limit All sources Look at other sources of income Maximising use of facilities – not trading if just ‘hand over the keys’ Further charitable purposes

13. Case Study 3 – Ratifying an appointment Check the relevant procedure Notify the Board immediately Consider whether the appointment can be deferred to the next Board meeting Board ratify the appointment

14. Case Study 4 – Procurement challenge What to do when faced with a potential challenge If it’s a below threshold procurement and followed school’s policy – tell them If it is above threshold and should have been advertised in the OJEU seek legal assistance Most complaints are settled out of court –a formal challenge is very costly and can damage a supplier’s reputation

15. Case Study 4 – Conflict of interest Academies “Connected Person” Duty to declare interest in a transaction Abstain from voting, not count towards the quorum, leave the room Is there a Trustee benefit - are extra steps necessary? Adequate training? Declarations of Interests? Ask about conflicts in quote/tender documents

16. Questions?

17. Contact: Sarah Thompson Associate Projects & Procurement Team Tel: 0191 279 9636 Email: sarah.thompson@bonddickinson.com Samantha Pritchard Associate Charities Team Tel: 0191 279 8391 Email: samantha.pritchard@bonddickinson.comsarah.thompson@bonddickinson.comsamantha.pritchard@bonddickinson.com