Public Procurement (Amendment etc.) (EU Exit) Regulations 2020
(3 years, 12 months ago)
Grand CommitteeRead Hansard Text Read Debate Ministerial Extracts
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, procurement by the Government and public sector bodies represents a significant part of the UK economy. It is essential to the day-to-day running of government and should be appropriately regulated. The Government are committed to ensuring the continued functioning of this important marketplace when we leave the EU.
This statutory instrument will ensure that the UK will meet the requirements of the withdrawal agreement and the Northern Ireland protocol and replaces the earlier statutory instruments that did not take these matters into consideration. This legislation is essential to provide legal clarity for public procurement and certainty going forward, as we look at the possibilities for wider procurement reforms, which may be brought into domestic legislation.
The majority of this SI is unchanged from the Public Procurement (Amendment etc.) (EU Exit) Regulations 2019, as amended by a second SI made in 2019, instruments that were debated in both Houses before being signed. Those instruments however, addressed deficiencies in a no-deal scenario. This instrument consolidates the first 2019 SI as already amended, incorporating further changes and new provisions, where relevant. The amendments made by this instrument do not amount to a material change in procurement policy. They will ensure that the UK’s procurement system continues to function as intended at the end of the transition period. UK contracting authorities will be able to continue to procure goods and services without substantial changes in the process. In that way, the Government are ensuring that those entities can continue to be able to obtain value for money for UK taxpayers.
The instrument makes amendments to the three sets of regulations that implement the EU directives on awarding contracts and concessions in the public and utilities sectors outside the field of defence and security. Your Lordships debated a separate instrument amending the Defence and Security Public Contracts Regulations last week. Where this instrument differs substantially from the 2019 instrument is that it seeks to provide a level of continuity for procurement procedures which began before the end of the transition period. Procurements that fall within this category, including orders from ongoing contracts, will continue in substance to follow the unamended procurement regulations. We do not expect that there will be many procurements which fall into this category; however, it would be difficult to measure these exactly. A number of new technical amendments have also been included in this instrument.
This instrument makes it clear that specifications with an information and communication technology component can continue to refer to the common technical specifications recognised by the EU Commission. This is an extremely dynamic area of technical specifications, and the EU’s process for recognising them is based on accepted best practice that the UK Government have been instrumental in developing. We have decided that, pending a mechanism to identify these domestically, retaining the reference to the EU’s standardisation process is deemed the best solution.
The thresholds that govern the award of public contracts came into effect in the UK on 1 January 2020, and the sterling figures in this instrument reflect those updated figures. The procurement of certain legal services by a lawyer as defined by the lawyers’ services directive are excluded from the procurement regulations. So that EU lawyers do not receive preferential treatment over those from third countries, this instrument amends the definition of lawyer to mean a person practising as an advocate, barrister or solicitor in any part of the UK or in Gibraltar. That includes those Swiss lawyers entitled to practise under their domestic designation in accordance with the Swiss citizens’ rights separation agreement.
This instrument also makes various amendments to the procurement regulations to reflect recent amendments made to other domestic and retained direct EU legislation —for example, in relation to the acceptable formats for advanced electronic signatures, and the applicable rules for determining the origin of products. To enable the procurement regulations to reflect technological developments and full and ongoing interoperability in electronic invoicing, a power has been conferred on the Minister for the Cabinet Office to make regulations to substitute a different e-invoicing standard, a different reference from the same standard or make changes to specific syntaxes for e-invoices.
The instrument disapplies rights derived from Article 18 of the Treaty on the Functioning of the European Union and parallel provisions in other agreements, to the extent that they are not disapplied in other domestic regulations. Retaining these rights would leave a lack of clarity as to whether EU parties within the scope of Article 18 of TFEU would have additional rights in the UK compared to non-EU countries. For example, suppliers from the EU may be provided with additional rights compared to third-country suppliers.
The UK has been invited to accede to the government procurement agreement, or GPA, in its own right. This instrument repeats the contingency arrangements set out in the 2019 EU exit statutory instrument, in case we are unable to legislate for GPA accession, resulting from any delay to the Trade Bill. One of the amendments ensures continued guaranteed access, rights and remedies on current terms for suppliers from existing GPA parties who would no longer have the guaranteed access, rights and remedies that they currently enjoy. This will mitigate the risks of a short gap in GPA membership by facilitating continued market access. Due to delays to the Trade Bill, we have also included a similar measure to this in relation to certain bilateral trade agreements between the EU and third countries to which the UK is currently party via its membership of the EU. This will keep alive the existing obligations towards suppliers from countries with which the EU has, before the end of the transition period, entered into a trade agreement with provisions relating to public procurement by which it is bound. The period in the 2019 EU exit SI was set to 18 months. This has been reduced to 12 months in this instrument to reflect the progress made in the Trade Bill.
In summary, this instrument seeks to ensure that the current public procurement regimes will continue to function after the end of the transition period, and to implement the relevant sections of the withdrawal agreement. It does not seek to make major policy changes or introduce new frameworks; instead, it makes largely technical changes to correct the deficiencies that will naturally emerge within our legislation at the end of the transition period. Left unamended, the existing regulations would not work as intended, and the EU exit regulations made last year in the context of a no-deal scenario would come into force. This would amount to a breach of our international obligations as well as a cause of confusion and uncertainty for procurers and suppliers, hampering the public sector’s ability to obtain value for money from procurement. I commend the regulations to the Committee and beg to move.
Lord Blunkett (Lab) [V]
My Lords, the Minister has spelled out very clearly the rationale for this instrument and I do not think that anyone this afternoon will object to taking this forward and providing for the next 14 months the certainty critical to business, commerce and our future trading arrangements.
I should just like to lighten the afternoon a bit by explaining that last week I was responding to a student who had asked me about the lead-up to Brexit. In replying to her, I dictated on to my digital recorder, for download by my assistant, my thoughts, which included the word “Brexiteers” several times. On every single occasion the predictive text provided us with a bit of a smile by downloading “bringing tears” rather than “Brexiteers”. For many of us, those tears continue to run down our cheeks.
This afternoon’s measure is very practical and I merely want to raise three points. First, there is the importance, highlighted by Paul Blomfield, my former parliamentary colleague from Sheffield, when this was debated in the Commons, of widening the issues that we would want to take forward in future. I hope that in the Trade Bill and any instruments arising from it we will be able to do that in terms of social value, the carbon agenda and environmental impact, and therefore be able to widen the current harmonisation and continuation of existing practice, including through the GPA.
The second is to ensure that we continue the process of recognising that harmonisation and alignment are a benefit to us rather than a disadvantage. The Minister spelled out why that was the case for the next 14 months and I think most of us recognise that it will be the case for many years.
The third and slightly more controversial point, which I could not resist making in my short intervention on these regulations, is that we are in a bit of a mess in this country at the moment on procurement. We have seen examples—understandable, given the speed of operation—of procurement in dealing with Covid that are completely unacceptable and place civil servants in an impossible situation. I would like the Minister to take back to his colleagues people’s genuine worry about how procurement is operating and the real danger of nepotism and worse. We really do need transparency, as well as systems that do not allow those in the know, or those who know the people in the know, to be the ones who get the contracts.
Baroness Boycott (CB) [V]
My Lords, it is a delight to follow the noble Lord, Lord Blunkett, and I agree with his point about the need for transparency in awarding contracts. If the last few months have shown us anything, it is the enormous power of procurement and what it can do when aligned with the right motives.
Following on from what the noble Lord, Lord Blunkett, said, I have a few brief remarks about widening the remit and taking into account both the environmental and public health impacts, effectively, of the things we buy. The Government’s buying standards for public procurement are closely aligned with the EU’s Green Public Procurement programme, but they are not mandatory and therefore do not have enough teeth. A recent report from Sustain, the alliance for better food and farming, shows that two-thirds of councils have left food out of their climate emergency plans, only 20% include the climate implications of procurement at all, and only 13 councils are considered to have suitable plans in place, given that we face a climate emergency. This report is about to be released but, apart from the statistics above, about 67% of council climate action plans contain no new or substantial proposals on food. I think everyone has learned in the last few months or years just what that means for biodiversity and climate change.
Also, for public health, a good diet in the public sector needs to be normalised at a national level. At the moment this generally means councils going against the grain, with limited budgets to implement change. We should have mandatory standards for serving meals high in fruit and vegetables and low in ultra-processed foods and serving less meat across the public sector. We need to make it easier and quite normal to serve better meat and dairy and to work more locally. This has a lot of benefits for both the environment and the sustainability of small farms. When I ran the London Food Board, we set up a big buying scheme among a bunch of schools and were able to deliver cheaper and better food through intelligent purchasing.
The Government’s other great big success story is the buying standards for sustainable fish. We now have strong, clear rules and they have been adopted by caterers in the public sector in workplace and university restaurants, and by a lot of retailers. This has shown the great potential for public sector food to establish and embed high standards in the new normal. In 2017, however, a Department of Health report found that only 52% of hospitals, of all places, were actually compliant with Government’s own buying standards. I urge the Government to do something about it.
Before I finish, I have some questions. Will the Government commit to all public procurement tendering processes for contract renewals being aligned with our net zero 2050 target? Finally, can the Minister confirm whether all government departments have a specific sustainable procurement policy in place? If the answer is “not all departments”, can the Minister tell me which departments have it and which do not?
Lord Wigley (PC) [V]
My Lords, I am delighted to follow the noble Baroness and I very much agree with her comments on working more locally. I want to raise three points with the Minister in the limited time we have.
First, I ask for an assurance that no procurement contracts currently in force will be undermined, nullified or constrained by these regulations, and that no new contracts entered into by devolved Governments in Wales and Northern Ireland—I realise that Scotland may be different—will be made void by any part of these regulations if such contracts are a renewal of existing procurement contracts or are issued based on the same principles.
Secondly, I draw attention to paragraph 10 of the notes accompanying these regulations, which refers to “regular engagement” having been undertaken with the Welsh, Scottish and Norther Ireland Governments, but does not say whether agreement was reached on these matters with those Governments. Perhaps that could be clarified.
Thirdly, I draw attention to Regulation 16, which refers to:
“The Water Industry (Specified Infrastructure Projects) (English Undertakers)”
and puts the Minister for the Cabinet Office in place of the European Commission. Does “English Undertakers” refer to undertakers operating in England, or does it include operators based in England who may be operating in Wales? If so, should there not be some reference to Welsh Ministers in that context? Those are the three points I wish to raise.
Lord Foulkes of Cumnock (Lab Co-op) [V]
My Lords, I am grateful to the Minister for his introduction and for the very helpful Explanatory Memorandum to the regulations, which tells us that the EU regulations have ensured that the
“public procurement market is open and competitive and that suppliers are treated equally and fairly.”
It goes on to say that in most respects that will remain substantially unchanged; any changes will be to correct minor deficiencies. Therefore, I should like to follow up on my noble friend Lord Blunkett’s third point and ask the Minister whether he can explain some recent public procurement decisions in light of this.
Why, for example, was a contract for hand sanitiser given to TAG Energy without competitive tender, especially as that company was reported dormant on 25 February and the contract awarded on 1 March? Why were contracts awarded without tender to Public First and to Topham Guerin, the company that ran the social media campaign for the Tories in the 2019 general election? Was there any tendering before Randox, which employs Owen Paterson MP at over £8,000 a month, was given a £133 million contract for Covid testing? Did Serco, for which the Health Minister Edward Argar used to work, have competition before it was awarded contracts for contact tracing and call centres totalling over £150 million? Finally, although I could ask about many more, did the company of the noble Baroness, Lady Mone—PPE Medpro—face competitors for the contract for 25 million gowns? Was it advertised to any other bidders?
These are just a few of many examples where it seems the proper procedures were not followed. I understand the urgency at the moment, but it is no excuse to say that we are in the middle of a pandemic when lucrative contracts have been given to companies with no experience in that area, many of which seem to have only one thing in common: a link with the Tory party. It is small wonder that the media have again said today that there appears to be a new virus around—“crony-virus”. I look forward to the Minister’s answers to my questions with keen anticipation.
Baroness Bennett of Manor Castle (GP) [V]
My Lords, it was extremely tempting, in preparing for my three-minute slot, to talk about the endless stream of disastrous public procurement decisions in the Covid pandemic, which made the term “chumocracy” such a figure in media headlines, as the noble Lord, Lord Foulkes of Cumnock, just reflected. But I have chosen instead to follow the noble Baroness, Lady Boycott, by taking this opportunity to focus on the impact of procurement on the dangerous, disastrous state of public health; the UK’s responsibility, as chair of COP 26, to show the way in public procurement that benefits our poor, fragile, battered earth; and to add to that, as the noble Lord, Lord Blunkett, did, the need for procurement that adds social value in our poverty-wracked society.
The Government tell us they want to be world leading in every area they mention, yet we are, once again, at the back of the pack in using public procurement to improve public health and the environment. Back in October 2019, I asked Written Questions of the respective Ministers what percentage of food served in schools, prisons and hospitals was organic or locally sourced. On schools, I was told that the Government had no information at all. The noble and learned Lord, Lord Keen of Elie, was able to tell me quite a bit on prisons, although not the specific information that I asked for. On hospitals, I was pointed to a forthcoming independent review of NHS hospital food that did indeed report last month. Henry Dimbleby’s initial food strategy report highlighted similar issues.
So it is good that there are signs that the Government are catching up with this agenda, even though they are many years, even decades, behind. In Latvia, for example, since 2014 it has been mandatory to apply green public procurement criteria in food and catering services in state and local government institutions. Finnish procurement for public food aims to assist the national goal of every adult consuming half a kilo of fruit, vegetables and berries every day. The city of Copenhagen aims to serve 90% organic food in public kitchens, favouring seasonal and diverse produce. For example, one tender included 86 different varieties of apple from seven different wholesalers.
What is striking about all these examples is that there is, tied to health and environmental criteria, a desire and outcome that focuses on local, small, independent producers, rather than the giant multinational producers of dull, tasteless, ultra-processed pap, which forms so much of British institutional diets. The health and environmental advantages are obvious, but since the Government tell us they aim to build back better and to level up, that must mean spreading out the economy, breaking up the hold of giant multinational companies and building up market gardens, local manufacturing and small independent businesses across the land. EU membership never stopped this, as my examples show, so the continuity the Minister referred to still provides a chance for a fresh start and a bid to catch up with so many of the nations that have raced ahead of us.
Lord Hain (Lab) [V]
My Lords, in October 2019, the Prime Minister agreed the political declaration on the UK’s post-Brexit relationship with the European Union, which committed Britain and the EU each to adopt “common high standards” in state aid, competition, employment law and social legislation. In November 2019, the Prime Minister boasted that Brexit would free him to make fundamental changes to Britain’s public procurement rules. The implication was clear: he planned to relax the current rules on procurement and state aid and introduce some kind of “buy British” policy to echo Donald Trump’s “buy America” policy.
We are told that this week could be when the EU-UK trade talks finally come to a conclusion. We know that Ministers are already discussing a draft Green Paper on procurement and that the Cabinet Office is consulting stakeholders on future procurement rules, including new criteria for awarding contracts. Perhaps the Minister could say what those criteria might include. They ought to include setting stronger employment standards, delivering a fairer deal at work, and doing more to help those hit hardest by technological change.
Achieving record rates of employment is not enough. The last Labour Government did it and, despite a decade of austerity, the coalition Government and the post-2015 Tory Governments have done it too. Until the virus crisis there have been lots of jobs, but too many have been insecure, with nearly a million people struggling to survive on zero-hours contracts and a million in temporary work or doing second jobs. Many more have been vital jobs done by key workers filling essential roles but receiving unfairly poor pay and scant recognition. The Institute for Fiscal Studies reckons that key workers receive significantly lower pay than other workers. Surely the Government must use their procurement power to deliver a fair deal to their own employees, such as health workers, and to staff employed by private sector firms working on public sector contracts, such as care workers, delivery drivers and cleaners.
Many communities have missed out, having been hit hard by technological change and economic disruption, such as those in the south Wales valleys and in former centres of heavy industry in the north of England. Successive Governments have struggled in vain to counter the uneven impact of structural change, which has left millions of industrial casualties in its wake as old industries fade and new ones locate elsewhere. Public procurement has a really big part to play in steering new jobs to places left bereft by globalisation and technological change. Can the Minister confirm that regulations such as these will drive that very objective?
Baroness McIntosh of Pickering (Con) [V]
My Lords, I thank my noble friend the Minister for introducing an important SI to the Committee. Could he set out, as page 9 of the Explanatory Memorandum mentions, the sequence of events for Britain applying to join the GPA? Is there any possibility that our application might be refused? What is the procedure for signing up to the new arrangements? I note that paragraph 7.30 of the Explanatory Memorandum says that the Trade Bill is
“highly unlikely to have completed its parliamentary passage”
and its implementing regulations adopted. Paragraph 7.32 then says that
“it is likely that the extension of existing duties … will be revoked and replaced.”
That begs the question of what the sequence of events will be. It would be helpful to know that there will be a smooth transition to the GPA.
I note that the Minister set out today and in one of the stages of the Trade Bill that the threshold for the GPA and EU public procurement arrangements are virtually the same—about €135,000. This is obviously a multi-million pound business. I wonder to what extent the Government encourage our businesses to bid in particular for food and agricultural products to supply schools, hospitals, prisons and other public bodies in other countries. Without this public procurement there would be huge benefits to our local farmers and producers supplying our very own schools, hospitals, prisons and other public bodies with locally sourced meat. It would be helpful to know that they will be encouraged to bid for this wider market in so far as it is feasible.
One remaining question, to which my noble friend referred—and I declare that I am a non-practising Scottish advocate—is that the definition of “lawyer” has been changed. Is that to take account of the United Kingdom Internal Market Bill? I just wondered for what particular reason the definition has been changed at this stage.
I would like to know what the sequence of events is for us joining the GPA, to be sure that it will be a smooth transition, and that the Government are doing everything in their power to bring these contracts for public procurement to the attention of the relevant businesses to enable them to apply for what could be a costly tender.
The Deputy Chairman of Committees (Lord Brougham and Vaux) (Con)
I call the noble Lord, Lord Bhatia. Lord Bhatia, are you there? I call the noble Baroness, Lady Wheatcroft.
Baroness Wheatcroft (Non-Afl) [V]
My Lords, as others have done, I thank the Minister for introducing these essential regulations—clearly, we have to fill the gap that we are creating somehow.
It was good news on 7 October when the World Trade Organization agreed to the UK’s accession to the government procurement agreement when we can legislate effectively to join that agreement. The agreement covers contracts worth £1.3 trillion, so it is clearly important that we should have access to those contracts on a level playing field basis.
The noble Baroness, Lady McIntosh of Pickering, asked whether our Government are encouraging our businesses to apply for the appropriate contracts as they come up under the GPA. I would be glad to hear from the Minister exactly what the Government do on that front. Clearly, it is important that we export to the biggest possible market.
But I am concerned about that level playing field basis—and the noble Lord, Lord, Lord Hain, mentioned his concerns about this. Last year, the Prime Minister said that he would like to “fundamentally change” the public procurement rules to “back British business”. A Green Paper is expected shortly. Perhaps the Minister could tell us exactly when we might see it. Could he also tell us whether it is right to be concerned, as the noble Lord, Lord Hain, is, that we may well jeopardise our access to GPA contracts if, as the Green Paper will suggest, we move very strongly towards favouring British business?
Others have referred to the dubious nature of some of the contracts that have already been issued for PPE. I understand that the Government had to move quickly, but I do not understand why, as the Good Law Project has exposed, there had to be special procurement channels set up for “VIPs”. The Cabinet Office was directly feeding its contacts into the procurement process. Speed is one thing, but handing contracts to favoured friends is very different. Could the Minister tell us whether “VIP” channels exist in other procurement areas, not just PPE?
The Deputy Chairman of Committees (Lord Brougham and Vaux) (Con)
I call the noble Lord, Lord Bhatia. Are you there, Lord Bhatia? We will move on to the noble Lord, Lord Wallace of Saltaire.
Lord Wallace of Saltaire (LD) [V]
My Lords, this is the third version of a public procurement EU transition SI since January 2019. Later this afternoon, we will be dealing with the third version of a parallel exit SI on data transparency. My colleagues tell me that they have also been responding to the third version of a whole succession of EU exit SIs in many other areas. This looks like indecision and incompetence across government, with Ministers failing to provide clear direction to their officials or to decide what the hard detail of our future relationship with the EU will be.
The impression of confusion and indecision is heightened by the references in the Explanatory Memorandum to the not yet enacted Trade Bill, which means, as has been explained, that there will be an unavoidable gap in the legislative framework from 1 January. As the Minister knows, the delays to the passage of the Trade Bill are due to government hesitation, not parliamentary obstruction. We are now well over four years since the EU referendum and two years since the passage of the withdrawal Act. I can easily imagine the scorn that Conservatives in opposition would be expressing about any other Government that had drifted like this.
We are also being asked to approve this SI without having certainty about the nature of the UK’s future relationship with the EU. Can the Minister explain what differences in the applicability of this SI will follow from the absence of any deal with the EU, rather than a continuing legal framework for our relationship? Will UK companies and service providers retain any rights to compete for public procurement contracts within the EU in the event of a breakdown in relations? Will they retain such rights if there is some sort of minimalist deal?
In this case, an instrument that refers repeatedly to previous amendments and to the further amendments now proposed is deeply obscure, and will no doubt provide good fees for lawyers as they struggle to interpret it. Worse, it includes repeated phrases such as, “The Minister for the Cabinet Office may make further regulations”—combining legislative complexity with excessive executive powers.
I note that the SI provides for
“the continued application of the general principles of Union law applicable to the award of public contracts”.
That is very sensible, since the principles of Union law on public procurement were negotiated by UK Ministers and officials under previous Conservative Governments, including when Margaret Thatcher was Prime Minister. But that of course does not fit in with the absolutist definition of sovereignty that the noble Lord, Lord Frost, now expounds every week. There are continuing international obligations, as the SI recognises, which cannot easily be ignored when the UK Government wish.
I also note that the intention in this SI
“is to treat non-UK economic operators on a level playing field.”
That is also an abrogation of UK sovereignty, of course. Are we refusing to accept the concept of a level playing field in our future relations with other European states but reasserting it in our relations with contractors from Turkey, the Middle East and China?
The SI also touches on delicate questions about the relevance of international agreements in environmental, social and labour law. The EU is moving ahead in developing policies on how to include calculation of the embedded carbon in imported goods and international contracts. Will this also be a factor in calculating the value of bids for UK public procurement from foreign contractors? And on “social value”, will the Government take into account the political, labour and social conditions that contractors tolerate in their own home countries?
Several noble Lords have mentioned recent concern about public procurement by this Government. That raises wider questions about the outsourcing of public services and the management of public procurement. On another occasion, we must debate the contracts awarded without open competition to contractors linked to the Conservative Party through personal links or donations, or to overseas companies without relevant expertise or experience.
I was particularly struck by the award of one of the first test and trace contracts—
Baroness Sanderson of Welton (Con)
I am sorry to interrupt the noble Lord, but we will have to move on. There is a three-minute time limit.
Lord Wallace of Saltaire (LD) [V]
I was particularly struck by the award of one of the first test and trace contracts to a multinational company with its headquarters in Miami to manage a service that self-evidently depended on detailed local knowledge within England. But there have been many other surprising awards, which demand further scrutiny.
I have one last question, on which the Minister may wish to write to me. These SIs frequently refer to the United Kingdom and Gibraltar but rarely, or never, to the UK and the Crown dependencies, which of course were not members of the EU. I note that companies headquartered in Jersey or Guernsey are frequently awarded UK government contracts. Are UK companies also guaranteed a level playing field in return? Do the Crown dependencies follow and observe UK practice in this field? If not, should the UK Government not take back control of that aspect of British sovereignty?
Baroness Hayter of Kentish Town (Lab)
My Lords, we can support this draft instrument, but I am afraid that I have to raise the bigger question that is around. It was touched on by my noble friends Lord Blunkett and Lord Foulkes as well as by the noble Baroness, Lady Wheatcroft, and the noble Lord, Lord Wallace, and it is whether this Government can be trusted to adhere to public procurement rules. The Grand Committee hardly needs me to repeat what it read in the papers yesterday and again today; that has been mentioned. However, the record of Ministers bringing in their friends and relatives, whether paid or unpaid, to advise on or carry out government-funded work is making a mockery of our Nolan rules in procurement processes, and any integrity in the use of taxpayers’ money. I note that, in introducing this instrument, the Minister particularly mentioned the importance of value for money. This is partly why we make sure that we have competitive tendering.
We have read of lobbyists and their clients benefiting from vital information from such advisers before either the public or Parliament knows; of investors at a paid-for conference getting a heads-up on vaccine developments; and of £1.5 billion of taxpayers’ money being awarded to companies linked to the Conservative Party during the pandemic—companies with no record as government suppliers before this year. Urgency is not really sufficient excuse; I understand that it may have worked for the first couple of weeks, but not for this long after. In normal times Ministers must advertise contracts for privately provided services, so that any company has a chance of securing the work. A person’s connections are not supposed to help. Today it sometimes seems that unless you have a close connection with a Minister, it is not even worth tendering. My colleagues in the other place have endless stories about their local firms—firms with a track record—not even being considered. Sometimes their phone calls are not even answered.
It is not as if all this playing footsie with friends produces good results. Test and trace is hardly a success and we have had stories about unusable PPE. The noble Lord, Lord Evans of Weardale, chair of the Committee on Standards in Public Life, has just said that
“the perception is taking root that too many in public life, including some in our political leadership, are choosing to disregard the norms of ethics and propriety that have explicitly governed public life for the last 25 years, and that, when contraventions of ethical standards occur, nothing happens.”
Can the Minister assure your Lordships’ House that whatever the rules agreed in this instrument, or any other, good governance and ethics, not chumocracy, will determine how contracts are awarded?
On the issue itself, I emphasise just two points. One is about the devolved authorities. Have they agreed with this SI and were they involved in its preparation? I know that in Wales, for example, they have been worried about whether they will be able to use procurement to raise standards, along the lines suggested by my noble friend Lord Hain about a fair deal for employees of outsourced companies. There are also the issues raised by the noble Baronesses, Lady Boycott and Lady Bennett, about the use of procurement to promote healthy or local services, including for food. When is the Green Paper likely to appear and is it also being drawn up together with the devolved authorities?
I also have a question to which I ought to know the answer but do not. I apologise as it is a genuine question, and I am not trying to make any point at all. Who oversees this instrument? I know that it is always far too difficult to expect SMEs, which feel that they have been excluded, to take action. What will be the supervising and enforcement authority to ensure that all tendering keeps to this or any other instrument concerning procurement?
Lord True (Con)
My Lords, I thank all those noble Lords who have spoken in the debate, and for their general welcome for these regulations. I will obviously try to answer at least some of the points made, but a number of them have been extremely detailed and not ones of which I have had prior notice. Where I cannot answer, I will obviously follow the usual conventions.
I was taxed about this being the third version of a procurement EU exit SI; I sought to explain in my opening speech the reason why. As I thought that I had explained, the previous two SIs were prepared for no deal, while this SI is to reflect the obligations in the withdrawal agreement and is within the powers provided under the European Union (Withdrawal) Act. It can correct deficiencies caused by our exit from the EU and it acts to implement the withdrawal Act. It is not dependent on the deal’s outcome.
Crown dependencies are not members of the EU and therefore are not subject to the public procurement regulated by the EU. The exception is Gibraltar, where the EU directive has been implemented. That is why Gibraltar is specifically included.
I am not going to follow the rather more political comments about alleged aspects of procurement. It is clear that a number of noble Lords are close readers of aspects of the press. No doubt a number of journalists will be gratified by the reference to allegations in the press. What I say on behalf of Her Majesty’s Government, and so far as I am concerned, is that no one would defend any form of impropriety in public life. That is a fundamental position to which all political parties have subscribed and, I trust, will subscribe. As the noble Baroness opposite generously observed, a number of the allegations relate to the procurement of PPE and other materials in the early stages of the Covid outbreak. In repeating what I have said—that no one will defend any improper or inappropriate action—I am sure that there will, quite rightly, be a long and continued examination of these aspects and allegations.
The reality is that the Government have been working tirelessly to protect people and save lives. Our approach has meant that we have secured 32,000 million items of PPE for now and in the future, as well as developing the biggest testing system per head of population of all the major countries in Europe. We have processes for carrying out proper due diligence for all government contracts. The noble Baroness asked for more specific information about this and we take these checks extremely seriously. For contracts relating to equipment such as PPE, we have a robust process in place ensuring that orders are of high quality and meet strict safety standards, but I am happy to provide her with further information.
I was asked about the devolved Administrations. Noble Lords will know that I attach great importance to them personally. I assure the noble Lords, Lord Wigley and Lord Hain, and the noble Baroness, Lady Hayter, that the devolved Administrations were consulted on the amendments to the procurement regulations and that they agreed with this SI. They support it and were, I am advised, involved in the drafting.
On the undertakings that the noble Lord, Lord Wigley, asked me about, those covered previously will continue as before. Essentially, that is the overall purpose of the statutory instrument before us.
I was asked about the GPA. Obviously, the UK currently participates in the GPA via its EU membership. The UK needs to the accede to the GPA in its own right to maintain legally guaranteed access to the public contract opportunities that the GPA provides. The offer that we have made to GPA parties maintains our existing commitments in the UK part of the EU schedule. As noble Lords know, the withdrawal Act aims to ensure as much continuity as possible. The UK has approval to join the GPA in its own right and a number of international agreements with procurements chapters have been signed. Therefore, all suppliers should continue to be treated equally and fairly through open competition. We expect a smooth transition, having received agreement for UK accession from January 2021. I acknowledge, as I did in my opening remarks, that delays to the Trade Bill have led to the instrument having a 12-month contingency to avoid any gap.
On advertising GPA opportunities to British firms, a national portal is a requirement of the GPA. Each GPA party will have space to advertise its opportunities and suppliers will have open access to them. The e-notification service is free of charge and will be openly accessible.
The noble Lords, Lord Blunkett and Lord Wallace, the noble Baronesses, Lady Boycott, Lady Bennett and Lady Hayter, and others made important points about the nature of future procurement. One advantage of where we are and where we hope to go is that we will be able to govern our own approach. We will use opportunities offered by our exit from the EU to consider carefully long-term options for reforming the procurement rules. I am sure that my colleagues will keep in mind the issues that have been raised, such as social value and the environment. We cannot provide further details on the possible outcomes at this stage but I can tell the noble Baroness that the Green Paper to consult on the proposed future changes to the procurement rules is currently being prepared. The plan is to publish it before the end of this year. Any changes will obviously be subject to separate legislation, which will enable your Lordships to probe these issues further.
I agree that not all the material is absolutely central but obviously I agree with the importance of high-quality food. Long ago, I worked with my noble friend Lord Goldsmith, then the MP for my local authority area, to promote the importance of good-quality food in public sector bodies. The Government are extremely mindful of the importance of these issues.
I was asked about the definition of lawyers. I believe that I included some remarks about what “lawyer” meant in my opening speech but if that is not the case, we will let the noble Baroness, Lady McIntosh, know. I think that I answered that point.
We need to ensure that the public procurement regulatory regime will function after the end of the transition period, providing continuity and legal certainty for UK public procurers and suppliers and signalling to suppliers from GPA and other countries that those regulations will guarantee them continued access, rights and remedies.
I know that I have not been able to answer all noble Lords’ questions in this short time but I hope that I have given the Committee some assurance and clarified the implications of the amended legislation. I trust, therefore, that noble Lords will support this statutory instrument.
The Deputy Chairman of Committees (Lord Brougham and Vaux) (Con)
My Lords, the Grand Committee stands adjourned until 3.45 pm. I remind Members to sanitise their desks and chairs before leaving the Room. Thank you.