Business > Procurement

Putting public procurement beyond reproach

Published 18 May 2016

Amanda Pilkington, a legal director with DLA Piper, offers some best practice advice on ways in which contracting authorities can seek to protect themselves against subsequent scrutiny of an award decision in an increasingly challenging procurement environment

 

The last few weeks have seen a deluge of headlines hitting both trade and mainstream media highlighting "failed" outsourcing projects and calling for root and branch reviews of the basis upon which such contracts are awarded. This highlights the uncomfortable truth at the heart of a public procurement exercise, namely that in many ways a "properly" run procurement exercise might generate the "wrong" result for an authority.

The winning bid is determined by the application of objective criteria. This is consistent with the principles of equality, openness and transparency underpinning the public procurement rules designed primarily to ensure that checks and balances are applied to the spending of public monies. Preconceived ideas regarding a particular supplier cannot and should not be taken into account, although it remains to be seen how the "prior performance" concept introduced by the Public Contract Regulations 2015 could perhaps be leveraged.

In an atmosphere of increasing scrutiny, contracting authorities must be beyond reproach in terms of the way in which the procurement exercise has been conducted. This means audit trails, detailed evaluation reports written to the letter of the evaluation criteria (which is not always easy to achieve!) and consistent communication to all participating bidders. Easier said than done! Procurements are being run to incredibly tight timescales to achieve mandated savings with stretched procurement and overworked procurement teams.

So how can contracting authorities avoid the many pitfalls associated with running a public procurement exercise? Early on in the procurement process, we often find it useful to run a "procurement refresher" exercise particular for the technical and financial evaluators/team remembers who are typically removed from procurement activities in their day to day jobs. These refresher sessions can be used to cut through the perceived red tape and refocus attention on the fundamental principles underpinning public procurement law, namely that procurements must be run in an open and transparent way, with equal and fair treatment of all participating bidders so that no bidder is unfairly advantaged or disadvantaged. Such sessions are also useful from the contracting authority's perspective to demonstrate a clear intent to adhere to these fundamental principles in the conduct of the procurement.

This is a particular important message to deliver when one of the bidders is an incumbent provider. There is often a greater level of scrutiny where an incumbent bidder is participating. To avoid any suggestion that existing prejudices are being brought to bear on the procurement exercise individuals who are directly involved in the day to day management of the incumbent contract should (ideally) not be actively involved in the re-procurement exercise. However, this division of BAU and procurement team is not always possible either because of resource constraints or simply because those involved in managing the current arrangements have the best understanding of the service and the contracting authority's requirements.

So having reinforced the core principles of procurement law, the process then moves on to the conduct of the procurement exercise and in particular the evaluation phase. As highlighted above it is vital that a contracting authority has an audit trail to justify the basis on which an award decision has been made. Where possible authorities should leverage any tools and templates used previously or developed by its external consultants to help with this process.

For example drawing from its experience advising on large scale sourcing projects (both for private and public sector clients), DLA Piper has created a bespoke tool for public sector clients, a contract dashboard which is tailored to the Crown Commercial Services model agreement.

Evaluation criteria can then be pre-loaded into the dashboard and each amendment made by a bidder can then be marked against the criteria using the tool (which provides guidance as to what amendments might give rise to a particular score). An overall score is then generated which can be fed into other (non-legal) elements on the evaluation. This means there is a clear audit trail for the legal evaluation and, perhaps most importantly, it is cost effective (in our experience the time taken to evaluate a response can be halved).

This is just one example of a tool which can be deployed to assist in the procurement exercise. All these tools and tips have a common goal; to help facilitate the procurement of goods and services and the discharge by the contracting authority of its legal responsibilities.

Amanda Pilkington is a legal director with DLA Piper








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