The European Commission is currently consulting on the modernisation of public procurement policy with a view to updating the EU directives.

The UK Government has published the UK's response to this consultation, the highlights of which are as follows:

  • a warning note is sounded about the conflict between (1) using procurement policy to achieve societal and wider policy objectives; and (2) allowing authorities to achieve value for money and achieve their purchasing objectives;
  • the regime should be made more friendly to small and medium-sized bidders;
  • a proposal is made that contracts could be directly awarded for a fixed period of up to three years to employee-led organisations or mutuals, to allow employees to gain experience of running public services prior to being required to take part in a fully competitive procurement process;
  • Part B services should remain separate from the Part A services regime and there should no be no extension of the rules currently applicable to Part B procurements;
  • definition of contracting authorities - the catch-all provision around a body subject to "management supervision" by another contracting authority should be clarified so that it does not catch organisations where the government or other public body merely retains some light tough oversight, or long-stop step-in rights, but provides no funding or general management control;
  • call for an increase in the financial thresholds beyond which the EU procurement rules apply;
  • procurement procedures should be improved to reduce timescales and bureaucracy; the option of using the negotiated procedure with notice should be made generally available; and
  • selection and award criteria should be made more flexible; particularly, it should be possible to examine past performance, skills and qualifications at a later stage than simply at selection/PQQ stage.

The Commission is now formulating new legislation, which we expect will be available by the end of 2011.