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Procurement Bill [Lords] - Sitting 4
02 February 2023
Type
Public Bill Committee
At a Glance
Issue Summary
The amendment proposes giving preference to UK suppliers for Ministry of Defence defence or security contracts. Chris Evans discusses the Procurement Bill's amendment related to UK-based suppliers for defence or security contracts. The MP is discussing the Procurement Bill's clauses related to award criteria for procurement contracts, emphasizing the need for balance between innovation and value for money. The statement discusses clauses in the Procurement Bill related to excluding suppliers from public contract competitions due to misconduct or other issues. The speaker discusses the exclusion of suppliers based on mandatory and discretionary grounds for public procurement contracts under the Procurement Bill. The amendment proposes to move national security from discretionary exclusion grounds to mandatory exclusion grounds for suppliers posing threats to UK national security. The speaker discusses amendments related to excluding suppliers on national security grounds in procurement legislation. The statement addresses concerns related to national security and cyber-security threats posed by suppliers in supply chains delivering public contracts, and discusses amendments to make exclusion on national security grounds mandatory. The discussion is about Clause 30 and Clause 31 of the Procurement Bill, focusing on the exclusion of suppliers with improper behavior during procurement and modifications allowed in procurement procedures. The statement discusses amendments aimed at ensuring public procurement supports disabled individuals through employment programmes and clarifies eligibility criteria for reserved contracts. The statement discusses the Procurement Bill's Clause 32, which aims to reserve procurement for supported employment providers supporting disadvantaged individuals. Chris Evans discusses the Procurement Bill's clause 33, which pertains to public service mutuals and light-touch contracts. The statement discusses amendments to the Procurement Bill related to dynamic markets, a flexible procurement tool for contracting authorities. The statement discusses concerns regarding the Procurement Bill's provisions on dynamic markets and their impact on local authorities and other sectors.
Action Requested
Chris Evans is requesting that the Bill be amended to include a clause that would give an advantage to UK suppliers in defence and security contracts awarded by the Ministry of Defence, aiming to strengthen the UK economy and sovereignty. He highlights the importance of supporting British businesses and industries through procurement policies.
Key Facts
- The amendment would add clause (3A) to clause 23 of the Procurement Bill [Lords].
- The contract for fleet solid support ships was awarded to a Spanish-led consortium, with no guarantees of job retention included in the contract.
- This decision supports 1,200 UK jobs and 800 jobs at Harland & Wolff in Belfast.
- A bid from British companies would have sustained more than 2,000 direct jobs and about 1,500 in the wider UK supply chain, supporting another 2,500 local community jobs.
- The shipbuilding industry has lost 80,000 jobs since the early 1980s.
- Rolls-Royce announced 200 new apprenticeships at its nuclear skills academy in Derby, and Leonardo offers an apprenticeship scheme in Yeovil.
- The amendment seeks to ensure advantage to UK-based suppliers for defence or security contracts.
- 90% of defence spend is already within the UK.
- Evans presses his amendment to a vote despite Minister's concerns.
- Award criteria must balance innovation with value for money.
- Social value is important but needs realistic targets.
- CBI supports the renewed focus on social value in public-private partnerships.
- Clause 26 sets out basic principles for excluding suppliers from contract awards.
- Clause 27 ensures that exclusions apply at the start of multi-stage procurement procedures.
- Clause 28 addresses the application of exclusion grounds to subcontractors in supply chains.
- The clauses deal with mandatory and discretionary grounds for excluding suppliers.
- Environmental misconduct is included as a discretionary exclusion ground.
- National security concerns are addressed but may need further clarity in the Bill.
- There is uncertainty about whether contracting authorities will exclude suppliers based on discretionary grounds or merely disregard their tenders.
- Amendment 15 proposes moving national security from discretionary exclusion grounds in Schedule 7 to mandatory exclusion grounds in Schedule 6.
- New clause 1 mandates establishing a committee chaired by the Minister for Resilience to consider national and cyber security within the Government’s supply chain, meeting at least once every three months.
- New clause 4 requires the Secretary of State to publish a plan within six months to reduce public bodies' dependence on goods and services from high-risk countries.
- Amendments 18 and 15 to 19 relate to moving the national security ground for exclusion from schedule 7 to schedule 6.
- Clause 29 provides that suppliers may be excluded on those grounds only with express permission of a Minister.
- The speaker supports new clause 1, which aims to establish a SAGE-style committee for public procurement specifically looking at national security.
- New clause 1 aims to establish a committee to consider threats from suppliers in supply chains.
- Schedule 7 of the Bill includes an exclusion ground for national security concerns.
- The Minister must be notified before excluding a supplier on national security grounds.
- Clause 60 allows investigation and potential debarment under clause 62.
- Clause 77 enables termination of contracts if security risks are identified.
- Procurement policy note 09/14 mandates adherence to Cyber Essentials scheme for certain contracts.
- Clause 30 concerns the exclusion of suppliers who behave improperly during the procurement process.
- Clause 31 sets the scope for modifying section 19 procurement terms, allowing non-substantial changes and requiring consideration of timeframes for supplier responses.
- The Department of Health and Social Care is involved in mediation to recover public money from fraudulent PPE contracts.
- Amendments 32 and 33 seek to ensure that provisions related to supported employers are applied widely.
- The current threshold for an employer to be considered supported is 30% of disabled or disadvantaged staff, proposed by amendments 94 to increase it to 50%.
- DDPOs have at least 75% management committee representation from deaf and disabled people and a staff makeup of at least 50% deaf and disabled people.
- Clause 32 aims to reserve procurement for supported employment providers.
- Organisations must have at least 30% of their workforce composed of disabled or disadvantaged individuals to qualify.
- Public service mutuals are organisations spun out from the public sector to deliver social services on a not-for-profit basis.
- Clause 33 gives contract authorities the ability to reserve certain light-touch contracts for public service mutuals.
- The Delegated Powers and Legislative Reform Committee expressed concern over the broad power given to Ministers regarding which kinds of contracts are subject to the 'light touch' regulatory regime.
- There are about 500 CPV codes, making it impractical to include all of them in the Bill.
- Clause 34 allows contracting authorities to award contracts under a competitive flexible procedure through dynamic markets.
- Subsection (1) of Clause 34 permits restricting procurements to suppliers that are members of the market.
- Clause 35 defines utilities dynamic markets and their rules for establishing arrangements.
- Clause 36 outlines conditions for supplier membership in dynamic markets, prohibiting certain requirements like annual audited accounts unless legally mandated.
- Clause 37 sets out criteria for removing suppliers from a dynamic market, including those on the debarment list.
- Clause 38 specifies when fees can be charged to suppliers participating in dynamic markets.
- Clause 39 mandates transparency requirements for notices related to dynamic markets and their establishment.
- The Local Government Association raised concerns over terms missing from the Procurement Bill, specifically regarding school transport procurement.
- Regulation 34(12) of the Public Contracts Regulations 2015 allows sub-central contracting authorities to set time limits for tender receipt by mutual agreement.
- Professor Richard Bonnar expressed concerns about Clause 37 and its handling of supplier exclusion from dynamic markets.
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