Public Procurement
Debate between Alex Burghart and Lord Spellar(6 months, 2 weeks ago)
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Alex Burghart
My right hon. Friend asks a pertinent question—one that was at the forefront of Ministers’ minds when the legislation was drafted and as it made its way through both Houses. A number of provisions in primary legislation are there specifically to increase the chances that small and medium-sized enterprises, which are more likely to be British, get a bigger share of the £300 billion-worth of public procurement. Those provisions include everything from the online procurement system that we are building—which will increase transparency and allow greater notification of pipelines, helping small and medium-sized enterprises to prepare for those procurements—to reduced red tape, which will take the burden off those SMEs and reduce their barriers to entry. We are hopeful that a lot of local businesses in his constituency and in mine will benefit from this landmark piece of post-Brexit legislation.
The contents I was describing would typically include the contact details for the contracting authority, the contract’s subject matter, key timings for the procurement process, and various other basic information about a particular procurement that interested suppliers would need to know. The provisions also cover the practical measures that authorities must follow when publishing those notices, such as publishing on a central digital platform and handling situations in the event that the platform is unavailable.
Beyond transparency, the instrument includes various other necessary provisions to supplement the Act that will be relevant in certain situations. We provide various lists in the schedules so that procurers are able to identify whether certain obligations apply in a particular case, including a list of light-touch services that qualify for simplified rules, and a list of central Government authorities and works that are subject to different thresholds. The regulations disapply the Procurement Act in relation to healthcare services procurements within the scope of the NHS provider selection regime, which has set out the regulatory framework for healthcare services procurement since its introduction in January this year.
The regulations also set out how devolved Scottish contracting authorities are to be regulated by the Act if they choose to use a commercial tool established under the Act or procure jointly with a buyer regulated by the Act. The provisions of the regulations apply to reserved procurement in England, Wales, Northern Ireland and Scotland, and to transferred procurement in Northern Ireland. The Welsh Government have laid similar secondary legislation that will apply in respect of devolved procurement in Wales, and if the devolved body carrying out that procurement mainly operates in Wales, elsewhere.
The Government have consulted carefully with stakeholders throughout all stages of the reform process, and we published our response to the formal public consultation on these regulations on 22 March. That consultation was a great success, evoking a good response from the various representative sectors, and confirmed that the proposed regulations generally worked as intended. Many stakeholders urged that certain matters be clarified and explained in guidance and training, which is a key part of our implementation programme that is being rolled out across the UK. The Government response demonstrates that we have listened to feedback, and confirms a number of areas in which the consultation led to technical and drafting improvements.
Once the instrument has been made, contracting authorities and suppliers will need time in order to fully adapt their systems and processes before go-live. As such, the Government have provided six months’ advance notice of go-live of the new regime before these regulations come into force, which will happen on 28 October this year.
John Spellar
I thank the Minister for giving way—at least it will enable him to draw breath—but could I ask a straightforward question? To what extent is this instrument going to enable British industry and British services to compete on a level playing field, in which we prioritise our domestic producers like every other country in the world does?
Alex Burghart
The right hon. Gentleman knows what is coming, because he asked me this question a number of times during the passage of the Act. We are doing two main things: the first is that we are greatly simplifying our procurement processes, which—as he heard me say a moment ago to my right hon. Friend the Member for Wokingham (Sir John Redwood)—will particularly work to the advantage of small and medium-sized enterprises. However, the right hon. Gentleman must be cognisant of the fact that we have a number of international trade agreements with countries all over the world, in which we have agreed to compete with them on a level playing field. The only way in which we could deliberately give advantageous opportunities to British companies vis-à-vis those arrangements would be to break those trade deals. I am sure that is not what the right hon. Gentleman is proposing.
John Spellar
We have a lot of time and a thin House. I presume that the United States is also a signatory to the same trade treaties, yet it has the “buy American” legislation, which is very strong and very effectively enforced. In the area of shipping, for example, it also has the Jones Act, which says that anything being shipped between ports in the United States has to be carried by American vessels. The United States is working under the same treaty, so why is it able to do that, while we, for some reason—perhaps deep Treasury dogma, or long-standing civil service prejudice against industry—cannot?
Alex Burghart
If the right hon. Gentleman looks at the details of the trade deals that we have with other countries, he will see that by and large, those trade deals have been created in order to further commerce and trade between two countries, and agree that there will be areas in which there will be a level playing field between our country and that other country—that is often the basis of a trade deal. The United States is the world’s leading economy and has been for over a century, and can sometimes strike deals or come to arrangements that other countries that are not the world’s largest economy cannot. I am afraid he will have to go and do his own research on American trade deals, but I can explain to him why we have the procurement system we do and why, because of the steps we have taken in this legislation, we will be creating additional opportunities for small and medium-sized enterprises in his constituency as well as in mine. That is much for the better, and it is a much better situation than we found ourselves in while we were still in the EU, with a very cumbersome, slow-moving and long-unreformed system of procurement to which we had been shackled for about 40 years.
For the avoidance of doubt, Members will want to be aware that this statutory instrument has been corrected to remove drafting references and a couple of typographical errors that were mistakenly added during the publishing process. I hope that colleagues will join me in supporting these regulations and will approve this SI today.
Alex Burghart
Gosh—the Leader of the House? One day, Mr Deputy Speaker.
It has been a pleasure to listen to hon. Members and to hear the widespread support for the regulations. There is widespread recognition that they are a great improvement on the regime that we have swept away. They form part of one of the landmark pieces of legislation since our departure from the European Union.
We heard support from across the House for a procurement system that greatly supports small and medium-sized enterprises. As I said in my opening remarks, that was at the forefront of Ministers’ thinking as the Procurement Bill was devised. It was very much in the minds of the businesses and the contracting authorities that we spoke to as the legislation was put together. The right hon. Member for Warley (John Spellar) gave an excellent speech and referred to Churchill’s wonderful phrase that industry should be “more content”. From the extensive consultations we have undertaken to prepare the legislation, we know these regulations will make “industry more content”, and that this is very much what businesses have been asking for and looking forward to.
There are a number of things that will help small and medium-sized enterprises, not least transparency and our new online system. The hon. Member for Llanelli (Dame Nia Griffith) said, quite rightly, that the system must be easy to use. One of my first jobs as an adviser to Government was in child protection. I remember the disastrous integrated children’s system that was in place under the last Labour Government, which took hours upon hours out of social workers’ time. It was dreadful because it took them away from working with children and meant they had to follow a very bureaucratic process.
We must be committed to ensuring that people are able to enter data and use the system without taking away from the most important part of their job. The Procurement Act, the regulations and the supporting documentation also support social value. The national procurement policy statement, which we have published, is keen to make sure that we do not remain obsessed with the most economically advantageous tender, but instead move to the most advantageous tender. That is a broader understanding of what is useful to contracting authorities and to society, and enables the consideration of issues such as local jobs and local skills.
The right hon. Member for Warley mentioned skills, and he was quite right to do so. When I was Minister for Apprenticeships and Skills, I was very keen to make sure that we were building up high-quality, internationally competitive apprenticeships, which played to the skills that were going to be needed in the areas in which they were provided.
The right hon. Gentleman also spoke about levelling up. I saw one of the most powerful examples of levelling up when I was a Minister in the Department for Education. The Government created a freeport on Teesside, which was part of our job. The excellent Mayor of Teesside, Lord Houchen, who I am pleased to say has been wonderfully returned by his constituents, worked with business to build a hydrogen plant in the freeport. The deal that was struck was that the hydrogen plant would support local colleges in providing the high-quality apprenticeships that would get young people—and not so young people—the jobs in that community. That is levelling up: all parts of Government—both from Whitehall to a local level—working with providers of local skills and industry to make sure that people can be a part of the success story of their own communities. I am very proud that it is this Government who have helped to deliver changes such as this.
John Spellar
I thank the Minister for his positive remarks.
Cannot Government, as customer, prescribe ratios of apprenticeships within the contracts, particularly construction contracts, and stipulate, as was done at the Olympic Park, that if a company moves off site for whatever reason, including when a contract moves into a different phase, and a new company comes in, there is an obligation to transfer the apprentices across? That would be building a sustainable base for the future.
Alex Burghart
I am sure the right hon. Gentleman knows that that is often the case. We do have requirements for apprenticeships to be part of major Government projects. He quite rightly spoke about Government as an intelligent customer—intelligent not just in terms of getting the best price, but of getting the best overall value. I say to him again that the idea of having a system of most advantageous tender, not just most economically advantageous tender, was always at the heart of these regulations.
The right hon. Gentleman should look at the excellent work being done by the Crown Commercial Service. By bundling together purchases made by different parts of Government, we can make sure that we get best value—I mean value in the broadest sense. In the Cabinet Office—perhaps one of the less glamorous areas of Government—in which I am proud to serve, that work is under way, already saving British taxpayers billions of pounds and making sure that we have a better and more holistic view of what Government spend can do.
Work such as that, alongside legislation such as this, means that we are building a system in which not just industry is content, but Government and the taxpayer are too, as well as the small and medium-sized enterprises and the communities in which they sit. I recommend this motion to the House.
Question put and agreed to.
Resolved,
That the draft Procurement Regulations 2024, which were laid before this House on 25 March, be approved.
Oral Answers to Questions
Debate between Alex Burghart and Lord Spellar(10 months, 1 week ago)
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Alex Burghart
I thank my hon. Friend for his question. I know that he will have followed the passage of the Procurement Act 2023 through Parliament closely, as will businesses in his constituency—particularly SMEs, I hope. He will have seen that the Act removes unnecessary obstacles relating to audited accounts and insurance for the conditions of participation, meaning that small businesses will no longer be shut out of the procurement process or incur unnecessary costs. That duty that I referred to earlier for those procuring Government contracts to consider how to remove barriers to SMEs will really change the landscape for our small and medium-sized enterprises.
John Spellar (Warley) (Lab)
In his reply to the right hon. Member for Haltemprice and Howden (Sir David Davis), the Minister totally missed the point, because he referred to defined reasons why companies could be excluded. The Government and Parliament make the rules. They have been dragging their feet month after month, year after year, on changing that in this regard, but also in terms of supporting domestic industry, as every other major economy does. When will they sort this out and get it down to the House and into the rules, over civil service intransigence and delaying tactics?
Alex Burghart
The right hon. Gentleman will have heard what I just said to my right hon. Friend the Member for Haltemprice and Howden (Sir David Davis). I know that, as a lover of due process, he will believe that the statutory inquiry should appropriately have the final word on this. And when it does, we will have absolutely no compunction in acting.
Procurement Bill [Lords]
Debate between Alex Burghart and Lord SpellarMonday 9th January 2023
(1 year, 10 months ago)
Commons ChamberRead Full debate Procurement Act 2023 View all Procurement Act 2023 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 75(a) Amendment for Third Reading - (8 Dec 2022)
The Parliamentary Secretary, Cabinet Office (Alex Burghart)
I warmly welcome the new hon. Member for City of Chester (Samantha Dixon). I could not help but notice that the Chamber filled up slightly when she was speaking—almost as though she was more popular than the subject under debate today. I genuinely enjoyed her speech; as a former history teacher, the only thing I was disappointed not to hear mentioned was a beautiful silver penny from the early 10th century, which seems to show the walls of Chester. It was issued, we think, by Alfred the Great’s daughter—another great woman who represented her city.
The Bill before us is a major and exciting piece of post-Brexit legislation. It is an opportunity for this country to take back control of its procurement regime to the advantage of our businesses, our authorities, our public services and our country. I must at the outset say some words of thanks to Lord Agnew, who was instrumental in seeing this legislation drafted in the first place, to my right hon. Friend the Member for North East Somerset (Mr Rees-Mogg), who played a fundamental role in ensuring it was prepared for the statute books, and to Baroness Neville-Rolfe and Lord True, who took the Bill through in the other place.
Despite some of the remarks made by Opposition Members, I also thank the Opposition for their constructive stance towards this legislation. It is important that we get this right. Enormous opportunities are there to be taken from this £300 billion-worth of public procurement. We on the Government side of the House can very much see how those advantages will be made.
As I have said, the Bill will replace the current bureaucratic and process-driven EU regime for public procurement by creating a simpler and more flexible commercial system that better meets our country’s needs while remaining compliant with our international obligations.
John Spellar
I know that the Minister has to talk about Brexit and all the rest of it to please those on his Back Benches, but surely the real problem is not in Brussels but in Whitehall, with Ministers who will not get a grip of Whitehall and behave like every other European country by backing our own industry.
Alex Burghart
If the right hon. Gentleman had witnessed the consultation that was held on the legislation, he would see that the problem very much was in Brussels. For a very long time now, authorities and businesses of all sizes in this country have been aware of the enormous limitations in the way in which EU procurement rules are set out. The Bill cuts through that.
Alex Burghart
The right hon. Gentleman says that it does not, but the shadow spokeswoman, the right hon. Member for Ashton-under-Lyne (Angela Rayner), said at the start that it did and praised the fact that it was creating a single rulebook. This will make it easier for our authorities to procure decent services from people who will be able to provide better value for money and will be held to account better. I am very pleased that it is this Government who are bringing it forward.
Opening up public procurement to new entrants such as small businesses and social enterprises so that they can compete for public contracts is a major part of this work, as is embedding transparency throughout the commercial lifecycle so that the spending of taxpayers’ money can be properly scrutinised. The main benefits of the Bill have been reflected by hon. Members on both sides of the House, including my hon. Friend the Member for West Worcestershire (Harriett Baldwin). By delivering better value for money, supported by greater transparency and a bespoke approach to procurement, the Bill will provide greater flexibility for buyers to design their procurement process and create more opportunities to negotiate with suppliers. As my right hon. Friend the Member for North East Somerset said, that will drive better value for money.
As we slash red tape and drive innovation, more than 350 complicated and bureaucratic rules governing public spending in the EU will be removed. We are creating better and more sensible rules that will not only reduce costs for businesses in the public sector, but drive innovation. That will be at the heart of our work as we encourage authorities to publish pipelines that allow businesses of all sizes to prepare for contracts in new and interesting ways.
We will make it easier for people to do business with the public sector. The Bill will accelerate spending with small businesses. A new duty will require contracting authorities to consider SMEs, and will ensure that 30-day payment terms are made on a broader range of contracts.
We also intend to take tough action on underperforming suppliers. The Bill will put in place a new exclusions framework that will make it easier to exclude suppliers who have underperformed on other contracts. As has been mentioned a number of times, it will also create a new debarment register—accessible to all public sector organisations—that will list suppliers who must or may be excluded from contracts.
A number of hon. Members on both sides of the House have referred to the excellent work that has been done on the ProZorro service in Ukraine. I am pleased to be able to let the House know that Ukraine was on our advisory panel and has actually informed our work, and our single digital platform takes a lot from what Ukraine has done with ProZorro. The platform will enable everyone to have better access to public procurement data. Citizens will be able to scrutinise spending decisions, suppliers will be able to identify new opportunities to bid and collaborate, and buyers will be able to analyse the market and benchmark their performance against others on spending with SMEs, for example—better transparency; better for taxpayers.