PLC Public Sector talks to Clare Reddy, partner at Lewis Silkin LLP:
When, late in 2008, the Commission announced the public procurement regime’s contribution to resolving the impact of the credit crunch would be to relax the rules on using the accelerated restricted procedure for major public projects, we warned that following this route may not be the most sensible course of action.
Two years on and the Commission has given contracting authorities the go ahead to continue to use this procedure until the end of 2011. Has anything changed? Clare Reddy, a partner at Lewis Silkin LLP, tells us that anyone reading the OGC’s information note on the subject and considering their options should still exercise caution.
There is always pressure in any public procurement to speed the process up and using the accelerated restricted procedure shortens the overall time limit from contract notice to contract signing from 87 days to as little as 31. However, Clare warns contracting authorities to bear one or two things in mind before rushing out and amending contract notices and programmes.
When does the relaxation apply?
Clare comments:
“Unhelpfully, neither the Commission nor OGC have defined what a ‘major public project’ is. The OGC guidance suggests it is any above threshold procurement ‘for which early execution would be of benefit to industry’. The aim of the relaxation is to improve economies during the credit crunch. A major regeneration project is likely to be a ‘major public project’, but what about a 25 unit housing project?
One needs to consider, on a project by project basis, whether the procurement would meet the aim of boosting the economy through rapid execution of the project. That aim, justifying use of the accelerated procedure, will then need to be clearly documented in the contract notice. ”
Is the restricted procedure appropriate for the project?
This is one of the major stumbling blocks to taking advantage of the relaxation. Clare highlights:
“For a ‘major public project’, the need for an element of discussion would more commonly result in use of the competitive dialogue procedure, which cannot be accelerated. Taking advantage of the shortened timescales under the accelerated restricted procedure will as a result tie your hands or may result in a challenge if you carry on negotiations in breach of the Regulations as only clarification and fine tuning is allowed by the restricted procedure.”
Is such a shortened timescale appropriate anyway?
As noted above, this relaxation applies to “major public projects”. The time limit for responding to an ITT under the accelerated restricted procedure can be as little as 10 days. Clare questions whether this gives the market enough time to respond to the authority’s needs, and indeed for the authority to really know what their needs are:
“We often find that it is during the planning of the procurement process, particularly in the drafting of the tender documents, that clients identify important issues that change their thinking, leading to an amendment to the structure of the project and the contract notice. If that change becomes apparent during, say, the ITT stage, it is too late. For this reason, we recommend that clients draft all of their tender documentation before publishing the contract notice, wherever possible.
Further, given that it will be a major project, is it appropriate (and would you be complying with your ‘best value’ obligations) to push something through requiring a less rigorous examination of the process, the bidders and their approach?”
A final note of caution
Aside from the increased administration that anyone taking advantage of the relaxation needs to be aware of, Clare gives one final warning to those who are still undeterred:
“The Commission does not have the right to ‘vary’ the English regulations that set out when the accelerated procedure may be used by issuing a statement. As a result you should query whether an aggrieved tenderer might have grounds for challenge if he believes he is prejudiced by the reduced timescales.”
In answer to the question posed at the outset of this post as to whether anything has changed, the answer seems to be a firm no. The requirements of any public procurement must always be considered in their own context and not just from the point of view of “how quickly can this be done”.