The Procurement Bill was introduced to the House of Lords on 11 May 2022, outlining the UK Government’s proposed reforms to public procurement in a post-Brexit world. The government sees the new bill as an opportunity to create a “simpler, more flexible system” of procurement, meeting key objectives of value for money, transparency and integrity, while also improving accessibility to SMEs and social enterprises.
As the bill passes through the House of Lords, this article outlines three proposed changes which will impact the way suppliers find and win public sector contracts.
Due to the amount of work required, the new regime is unlikely to be implemented until the end of 2023 at the earliest. The government will give suppliers a minimum of 6 months notice before the go-live date. Suppliers should note that the changes will affect England and Wales, with modified variations in Northern Ireland. Scotland will create their own separate system.
Three key changes for technology suppliers
1. Open frameworks & dynamic markets
The initial Green Paper consultation identified a number of issues with the current system of frameworks and DPS agreements, deemed overly complex and no longer fit for purpose. With the aim of simplifying the rules and adding flexibility for buyers to create commercially suitable systems, the new procurement bill proposes that frameworks and dynamic purchasing systems will be replaced with three commercial purchasing tools: frameworks, open frameworks and dynamic markets.
Open frameworks: A new opportunity for technology suppliers
The requirements for establishing a framework under the new bill are broadly familiar. As is the case under the existing regime, a framework term may not exceed 4 years (with a longer term for defence and security frameworks and utilities frameworks of 8 years).
The new open framework tool adds flexibility for authorities to create longer term frameworks and iterate suppliers, without making the authority start from scratch each time the framework renews.
"“An “open framework” is a scheme of frameworks that provides for the award of successive frameworks on substantially the same terms”. (Section 47, Procurement Bill)"
With a total term of up to 8 years from the first award, open frameworks will be required to open up to new suppliers at least once every 3 years. This makes open frameworks easier to access for suppliers, who can wait up to four years to apply to framework renewals within the existing framework system.
While this will improve accessibility for suppliers trying to gain places on longer term frameworks, it also adds flexibility for buyers seeking to exclude underperforming incumbent suppliers. With strengthened rules around exclusion, suppliers should be aware that this is a two-way process designed to increase value for money and decrease government reliance on monopoly suppliers.
From Dynamic Purchasing Systems to Dynamic Markets
Dynamic Purchasing Systems (DPS) exist under the current procurement guidelines, with the defining characteristics that they are open to new suppliers throughout their lifespan and that all suppliers on the DPS can access tender opportunities. At the moment, DPS systems are typically used for commodity type purchases.
In the spirit of increasing efficiency, DPS will expand into newly formed “dynamic markets”, which can be used for any type of procurement. With no constraints on time duration or the number of suppliers accepted, dynamic markets are designed to function as a filtering tool. They work by creating a ready pool of bidders who are already compliant with a buyer authority's terms of participation. Suppliers may come to expect that gaining a seat on a dynamic marketplace becomes a prerequisite for working with particular buyer organisations.
2. A central digital platform
Two complimentary digital platforms are at the heart of the government's plans to increase value for money and transparency throughout the procurement process.
“The Bill will also enable the creation of a digital platform for suppliers to register their details once for use in any bids, while a central online transparency platform will allow suppliers to see all opportunities in one place. We hope that this will accelerate spending with SMEs.” [Lord True, Procurement Bill Reading L [HL], May 25th 2022]
The current regime utilises a mixture of platforms: Find a Tender Service, Contracts Finder, the Supplier Registration Service, the Digital Marketplace, the Open Contracting Data Standard (OCDS) and the Contract and Spend Insight Engine (CaSIE).
Suppliers often find these systems difficult to use and information does not interoperate between platforms. By replacing these with a central online transparency platform and supplier registration platform, the intent is for notices to be more visible and easier to bid on, as suppliers will need to submit their data only once.
At a TechUK hosted Procurement Bill briefing event, the Cabinet Office confirmed that the central transparency platform will be built out of the existing Find-a-Tender service, with plans to deliver improved visibility of contract notices for go-live date. Additional features, such as buyer spend data and commercial analysis tools are planned for development later down the line.
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The new supplier registration system will operate alongside the transparency platform and is also planned for delivery on go-live date. All buyer authorities will be required to use this "tell us once" platform, which will permanently hold all of a suppliers’ credentials, reducing the admin costs of entering credentials for each bid.
3. Mandatory procurement pipeline notices
A key focus of the initial green paper consultation was to increase overall transparency throughout the procurement process. In line with this objective, 12 different notices are mentioned throughout the Bill. One of the new additions is the ‘Planning and Pipeline Notice. The below section focuses on this notice.‘
At the start of each financial year, buyer authorities will have 56 days to publish procurement plans in a pipeline notice if they intend to spend over £100m in the following year. This notice will require the authority to publish information for all planned contracts valued over £2m.
While suppliers can welcome this improvement to the current notice system, buyers will only publish plans for contracts that are required with a degree of certainty. With dynamic goals and moving targets, buyers may struggle to capture their whole procurement strategy in their annual pipeline notices. Proactive suppliers should expect to pre-engage with buyer authorities to fill in the gaps of their procurement plans.
Suppliers should also note that individual call-off contracts will not be included in the pipeline notice, nor will valuable contracts worth under £2m.
The changes highlighted in this article reveal the Procurement Bill’s clear intent on improving buyer flexibility, transparency and increasing the ability for innovative suppliers to access public sector opportunities.
While we wait to see how these new changes are implemented, proactive suppliers are already using Stotles all-in-one platform to find opportunities with the government and build their pub-sec pipeline. To get started, sign up for a free account using the link below.
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This article is a summary of three material changes suppliers can expect from the new procurement bill. For a full account of expected changes, please consult:
- The Procurement Bill - a summary guide to the provisions
- Procurement Bill [House of Lords]
- Local Government Association: Procurement Bill, Second Reading, House of Lords, 23 May 2022
It should be noted that any of the provisions of the Procurement Bill might change as a result of the process of parliamentary approval.
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