Government toughens rules to exclude underperforming suppliers

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New procurement rules will see companies with a track record of poor delivery, fraud or corruption blocked from winning public contracts, the Cabinet Office has announced today.

The plans are published as part of the consultation response to its procurement green paper.

The new plans are set to give the government more discretion to exclude previously poorly performing suppliers, such as those who have not delivered previous projects on budget or on time.

Suppliers can also be banned if they have undertaken unethical practices, such as a lax approach to safety, or where there are national security or environmental concerns.

Chancellor of the Duchy of Lancaster Steve Barclay commented on the announcement: “Leaving the EU gives us the perfect chance to make our own rules for how the government’s purchasing power can be used to promote strong values.

“While doing so we’re increasing transparency and ensuring that procurement remains fair and open.

“These simpler and more flexible rules will also make it easier for small businesses to win work – placing levelling up at its heart.”

According to the Cabinet Office, suppliers can only be excluded from winning new government contracts under the current rules if there has been ‘a significant breach of contract.’

With about £300bn spent every year on public projects such as the delivery of new schools, hospitals and roads, public procurement represents about a third of all public expenditure.

Transparency and emergency procurement

According to the Cabinet Office, new measures on transparency will be introduced so that members of the public can see exactly where their money is being spent and compare this across a range of services.

This will be done through procurement data being published in a standard, open format, accessible to anyone, as well as the increased efficiency of having a single registration platform for suppliers.

The plans will also make procurement ‘more transparent and effective’ during times of crisis, where government needs to act quickly to ensure vital goods and services are bought.

Competition will be introduced into emergency buying, meaning that government doesn’t need to wholly rely on direct awards in times of crisis.

Helping small businesses

The changes are set to make it easier for small and medium-sized businesses to bid for and win government contracts with a simplified bidding process.

One efficiency being brought in is creating one single central platform which suppliers have to register on, so they only have to submit their data once to qualify for any public sector procurement.

Levelling up

Procurement changes outlined in today’s consultation response are also set to help level up the country. According to the Cabinet Office, under the new rules, procurers will be able to ‘give more weight to bids that create jobs for communities, build back better from the COVID-19 pandemic and support the transition to net zero carbon emissions.’ These ‘social value’ factors mean that buyers don’t just consider price alone.

The greater flexibility in the new rules is set to allow local leaders and communities to grow the private sector and raise living standards in their area, by being able to procure ‘more locally and flexibly.’

More information about the consultation response is available on the UK Government website.