Public Procurement
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Rescooped by Marion Shaw from Public Procurement - Europe!

Major breakthrough in PQQ reform

Major breakthrough in PQQ reform | Public Procurement |

The European Parliament is set to vote on major changes to procurement rules [PQQ] which could see turnover requirements relaxed, larger contracts split up into lots and the introduction of a standard, reusable self-certification document


The proposed new EU Classical Procurement Directive 2013, which has emerged following three-way negotiations between the European parliament, commission and council of ministers, contains a raft of changes which could shake-up the way public projects are tendered [pre-qualification questionnaire] if fully adopted in the UK.

As well as plans to ditch the need for practices to prove how much they make - the requirements would become non-mandatory and capped to a maximum of twice the contracts’ value - there are also proposals to accelerate procedures, define and embed whole life costings in the process, and increase opportunities for consortia bids, with bidders not required to be legal entities when bidding only upon contract award.

The news is a significant coup for the RIBA which has been campaigning for fairer procurement for more than three years. In May 2012 the institute submitted its report: Building Ladders of Opportunity to government which argued for the reduction of bureaucracy, including the reduction of millions of pounds of wasted bidding costs and the simplification of pre-qualification questionnaires [PQQs] and the removal of barriers to market access.

Walter Menteth, chair of the RIBA Procurement Reform Group, gave a ‘cautious welcome’ to the latest draft of the directive.

He said: ‘On the ground we remain bogged down in bureaucracy and procurement gold-platting and there is little evidence to suggest that UK procurement culture has [recently] improved.

‘But the new EU Directive 2013 will represents a significant reform of public sector procurement. 

‘If the UK Government engages with the new opportunities for more creative procurement, exercising intelligent judgement, flexibility and new procurement routes, this could lead to a significant change in construction culture.’

Former RIBA President Angela Brady was less circumspect, adding: ‘It is bloody good news and what we’ve been campaigning for for three years.’

Anthony Hudson at Hudson Architects said: ‘This is very welcome news. The existing situation can hardly be worse - a bureaucratic madness that does not allow small practices to participate. The next procurement hurdle to be tackled ought to be the absurd levels of PI insurance that are often required - again locking out too many talented small practices. Anything that helps small practices navigate the bean counting world of procurement has to be welcomed.’

Philip Bintliff of Hebden Bridge-based Studio BAAD said: ‘We always think PQQs [pre-qualification questionnaire] should be a maximum two sides of A4 and notices should make it clear what threshold values are required. This is a step in the right direction - very welcome.’ 

The final text which is unlikely to be changed, is expectred to go before the European Parliament in either late September or early October.


EU directive headlines:-

There is a definitive commitment and provision for the EU renegotiating the raising of threshold values at the next round of international trade negotiations.There will be full e-procurement within 2.5 years.A new standard e-based reusable European Single Procurement Document allows self-certification of documentation requirements for submissions to participate, or tender.The European Single Procurement Document can provide links to national data registers, potentially including the RIBA Chartered Practice scheme.Negotiated procedures are simplified and incentivised.The principle of whole life costs are defined and embedded as pivotal within the new directive.Procedures are accelerated, with the opportunity to call for competition within Prior Information Notices.  The min. bid timescale in certain circumstances will now be 15 days.Turnover requirements become non mandatory and are capped to a max. 2x a contracts valueThe opportunities for consortia bids is enhanced, with bidders not required to be legal entities when bidding, only upon awardThere is a presumption in favour of splitting large contracts into more numerous lots unless justifiable. (through an “apply or explain” principle)MEAT (Most Economically Advantageous tender) becomes the default for construction industry tenders.Some procedures allow that cost in award selection maybe a fixed price allowing competition on quality criteria onlyThe principle of intellectual services is introduced, and then such intellectual services are ruled out as suitable for the electronic auction procedures.The EU makes clear its determination of the legal position of Bodies covered by Public Law. This would indicate confirmation that most UK RSLs should be excluded.The opportunities for R&D are improved.There is greater opportunity for creative procurement, with more flexibility, greater options and new routes to procurement along with the introduction of innovative partnerships.There is a strong emphasis on pre-market engagement, to improve briefing and market engagement, prior to tendering.Provision is made for abnormally low bids to be rejected  Better payment terms for tier 2 suppliers and allowance for more widespread introduction of project bank accounts, is embodied. ng the specific skill sets of designers eg based on their specific design/ drawing expertise (aesthetics).Opportunity for greater emphasis to be placed on assessing and selecting the specific skill sets of designers eg based on their specific design/ drawing expertise - potentially including aetheticsContract performance conditions may incl. for instance –Accessibility, design for all, economic, environmental, innovative requirements, social and employment related requirements

Via Toni Saraiva - EISC Ltd -
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Rescooped by Marion Shaw from Public Procurement - Europe!

Public procurement package: getting the best value for money

Public authorities will have more scope to decide how best to spend taxpayers' money on public works, goods or services thanks to new EU rules formally endorsed by the Internal Market Committee on Thursday. Rather than force authorities to accept the lowest bid, the rules would enable them to pick innovative solutions. For example, building a new road cleverly, rather than just cheaply, should ensure that it does not need to be rebuilt after five years.


Public procurement accounts for 19% of EU GDP, making it a powerful lever for achieving specific societal goals. The provisional deals struck with Council in July on three directives (on "classic" procurement, "utilities" and "concession contracts") would enable authorities to consider not only the price, but also environmental or social benefits or innovative ideas offered by a bidder.


For example, a contractor might want to ensure that good quality food is served in a kindergarten or hospital, or undertake to buy from a firm that employs people with disabilities.


Fair competition to provide best value for money


The new directives would also include tougher rules on "abnormally low" bids and subcontracting, so as to ensure compliance with labour laws and collective agreements. "These updates aim to fight dumping and ensure fair competition", said public procurement rapporteur Marc Tarabella (S&D, BE).


More innovative solutions


MEPs also inserted a new procedure to encourage bidders to offer innovative solutions. The draft directives provide for "innovation partnerships" enabling authorities to call for tenders to solve a specific problem without prescribing a solution. Authorities and bidders could then negotiate the most appropriate one.


Less red tape for bidders and easier access for smaller firms


Bidding would be simplified by providing a standard "European Single Procurement Document" in all languages and obliging authorities to share the details of eligible bidders from national databases. The system would be based on self-declarations and only the winning bidder would have to provide original documentation.


The new rules would also encourage the division of contracts into lots, so as to improve access to public procurement for small and medium-sized enterprises.


Concession contracts

Public authorities use concession contracts to hire private firms to supply services or to perform works, such as building roads, bridges or sports arenas.


New EU-wide rules would apply to public contracts worth €5 million or more. They would also give authorities more scope to pick the best offer, relying not only on the lowest price criterion, but also on environmental, social or innovation-related ones.


MEPs acknowledge the special importance of water as a public good and therefore agreed to exclude it from the scope of the concessions directive. However they also ask the Commission to assess the impact of this exclusion three years after the new directive has been transposed into member states' national laws.


"We have negotiated pragmatic, easy to apply new rules for works and services concession contracts so as to benefit all players: public authorities, economic operators and taxpayers" said concessions rapporteur Phillipe Juvin (EPP, FR).

The deals on the "classic" procurement and the "utilities" directive were both endorsed by 27 votes in favour, 1 against and 1 abstention. The deal on concessions was endorsed by 26 votes in favour, 2 against and 1 abstention.




The "Classic" procurement, Utilities (covering water, energy, postal and transport services) and Concessions directives are part of a package of four draft procurement laws tabled by the European Commission in December 2011. The fourth proposal, for a regulation on "third market access", is currently being examined by the International Trade Committee.

Next steps


The final plenary vote on the three agreements is scheduled for November.

In the chair: Committee Chair Malcolm Harbour (ECR, UK).

Via Toni Saraiva - EISC Ltd -
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