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Public procurement policy review: June – August 2013

Our third post on key developments in public procurement policy that lawyers advising in this area need to be aware of covers the period from June to August 2013. It does not consider case law, which is covered in our monthly public procurement case digest. For a summary of the latest cases, see Public procurement case digest – July 2013.

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 Procurement reforms

The new procurement directives are well on their way to being adopted following the endorsement by the Committee of Permanent Representatives (COREPER) on 17 July 2013 of the provisional agreement between the Council and European Parliament of the reform package. On 25 July 2013, the Cabinet Office published a procurement policy note highlighting some of the key changes. For details of the procurement reforms, see Practice note, Reform of the EU public procurement regime.

 New government initiatives

In July, the government announced the creation of an integrated Crown Commercial Service incorporating the Government Procurement Service and other services across government. The new service will provide a central contract management resource as well as strengthening procurement and commercial ability across the Civil Service. The new service will be established in the autumn.

The government continues to encourage a simplification of the procurement process to enable bids from SMEs and civil society organisations. The Cabinet Office guidance on procurement for growth provides some guidelines on maximising economic growth through procurement by opening the market to smaller businesses.

As part of its strategy for promoting value for money in contracts for public services, the Cabinet Office’s Centre for Social Impact Bonds provides support for organisations looking to use this model which enables the public authority to pay providers only when defined social outcomes are achieved. The Centre has published guidance and a template contract for social impact bonds. For more information, see Opinion, Commissioning for outcomes and social impact bonds: New models for delivering public services.

The European Commission has also announced initiatives aimed at reducing costs and improving the efficiency of the procurement process through e-procurement and e-invoicing.


 The procurement of health services remains a key issue for the government. The last couple of months have seen the start of two investigations by Monitor into alleged breaches of the NHS (Procurement, Patient Choice and Competition) Regulations (No 2) 2013 (SI 2013/500) (NHS Procurement Regulations). The investigations will look at procurement decisions taken by NHS England in respect of the selection of providers of surgery services in Yorkshire and Humber and Greater Manchester.

Monitor’s consultation on its proposed enforcement guidance under the NHS Procurement Regulations closed on 15 July 2013.

In recognition of the growth of procurement activity in the NHS and the need to find £1.5 billion in efficiency savings by the end of 2015-16, the Department of Health has published its Procurement Development Programme aimed at increasing expertise as well as efficiency and productivity. The Programme includes plans to establish a Centre of Procurement Development, incorporating an Academy of Procurement Excellence which will provide a centre for networking, learning and knowledge management.

The Procurement Development Programme highlighted the scarcity of skilled procurement professionals in the health sector. NHS England’s strategy for commissioning support services aims to assist CCGs and other commissioners of NHS services to source high quality commissioning support services, and to build and strengthen this sector through investment and the development of key relationships, and production of best practice processes and guidance.


As part of its attempts to reduce the costs of PFI deals under the Operational Savings Programme, the government has published a voluntary code of conduct for public sector and private sector partners who are involved in PFI and PPP deals. The code, which is not legally binding, sets out key commitments aimed at promoting better partnership working and transparency in costs.

On 21 June 2013, the government announced that a new unit has been set up within HM Treasury to represent the government on boards of new PF2 projects, its new approach for involving private finance in the delivery of public infrastructure and services.

The government’s consultation on the terms on which it would invest public sector equity in PF2, including draft standard investment documents, closed on 21 August 2013.

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