Implementation of the Public Procurement Directives in the UK Peter Bennett Office of Government Commerce Vilnius 9 December 2004

PROCUREMENT POLICY UNIT (OGC) APPLICATION of EC RULES Advice on what the rules say …. eg thresholds, procedures ….and what they mean. eg can you include incumbents in a new bid team? Can you exclude offshore companies EC AND INTERNATIONAL DEVELOPMENTS DOMESTIC VFM POLICY EUROPEAN PUBLIC PROCUREMENT NETWORK Representing the UK:- - negotiating new rules eg two revised EC Directives -influencing the development of EC Commission policy, and EC line in WTO - “margins” work influencing other WTO members PPN = cross border, pre-contract problem solving network with a best practice dimension Ensuring value for money (vfm) policy is understood and applied Working with OGDs to ensure that pursuit of other objectives through pp does not undermine vfm eg fairtrade, race relations, sustainable development Developing policy eg on remedies Handling UK infraction cases

UK Domestic Policy Requires all purchases of goods and services to be based on value for money, having due regard to propriety and regularityRequires all purchases of goods and services to be based on value for money, having due regard to propriety and regularity (Value for money = "the optimum combination of whole life cost and quality (or fitness for purpose) to meet the customer's requirement“)

Policy and law Directives and Treaty complement UK policy No UK law before implementation of Single Market Programme, early 1990s Directives implemented by Regulations (Statutory Instruments) under section 2(2) of the European Communities Act basic Regulations, each of which show how remedies can be sought References on OGC web site ( and link to text of regulationswww.ogc.gov.uk

THE LEGISLATIVE PACKAGE: KEY DATES 1996 – Green paper Communication May 2000 – Legislative package January 2002 – European Parliament (EP): 1 st reading March 2003 – common position: public sector & utilities July 2003 – EP second reading - amendments adopted December 2003 – agreement on conciliation text March 2004 – adoption of 2004/17/EC & 2004/18/EC (public sector)

Aim of legislative package Simplify - 1 public sector directive Clarify - use of frameworks - central purchasing bodies Bring up-to-date - electronic methods - introduces competitive dialogue procedure - takes account of liberalisation in utilities

UK implementation.Member States have 21 months from date of OJEU publication – 30 April 2004 UK implementation likely to require full 21 months Process set out in implementation plan 2 rounds of consultation planned Aim to copy out as much as possible Helpful that many of the basic provisions remain substantially the same as in the existing Directives

First consultation -Consultation documents for public sector and utilities circulated May 2004, allowing 3 months for comment -PPU wanted to know : -do consultees want us to make use of options -reactions to our suggested approach on reserved contracts & mandatory exclusions -responses sought on particular issues, such as the need to elaborate where text is difficult to understand

‘Optional’ issues Central purchasing bodies (cpbs) Competitive dialogue Framework agreements Dynamic purchasing systems E-auctions Can utilities themselves apply for exclusion

Outcome of consultation 255 responses, mostly on reserved contracts many covered both public sector & utilities, only 9 concerned just the utilities general support for making maximum use of options numerous requests for specific guidance

Outcome of consultation (2) - CPBs – fully implement, but many questions -competitive dialogue – stick to text, need for guidance -frameworks – guidance good, new Article helpful -DPS – need for clarification & guidance -e-auctions – welcome article, need for guidance

Outcome of consultation (3) On issues just concerning the Utilities, the majority agreed that: the structure of the UK Regulations indicating scope & coverage should be maintained, -the text of the affiliated undertakings provision was sufficiently clear for it to be copied out, and -Utilities should be allowed to apply for exclusion direct.

Next steps & other activity Regulations will be drafted A further round of consultation will take place Regulations will be finalised & put in place by January 2006 Training module on the new Directives is on the OGC website