Single Source Contract Regulations 2014

Lord Tunnicliffe Excerpts

Tuesday 9th December 2014 Grand Committee

In conclusion, the changes we are introducing to single source procurement are long overdue and represent a significant enhancement to how we procure for this key part of our defence capability. This is a fundamental reform developed over a considerable period of time and following extensive preparation. We expect that the benefits will fully emerge only over the longer term but are entirely confident that these benefits will be both substantial and wide-ranging. I commend the regulations to the Committee.

[Lord Tunnicliffe (Lab)]

My Lords, I thank the Minister, the noble Baroness, Lady Jolly, for that introduction. I would just like to say a word about the role of the Official Opposition in this process. The Act and the regulations are enormously complex and, in taking the Bill through, we took a decision to have most of our conversations with the Government not on the Floor of the House, and to make sure that the clarifications and so on that emerged were read into Hansard during the subsequent debates. That worked very well.

The problem with taking that forward, of course, is that the regulations, I think, are actually longer than the section of the Act that they refer to. Therefore there were as many concerns of detail in the regulations as there were in the Act, and I thank the Minister and her officials for finding time to talk to us about the regulations and for her letter. It was important to read it into the record because Hansard, in a sense, lives for ever—one has only to walk down our corridors to realise that—whereas, splendid as the letter is, I will probably lose it and probably nobody else will actually see it. Having it in the record is therefore worth while. Therefore I thank the Minister for that repetition, long as it necessarily was.

On the general thrust of the Act and the regulations, I commend the Government for bringing them forward. I believe that it has taken them something like five years to work on this issue. I see nothing political about it, and the Ministry of Defence is now equipped with a piece of legislation that gives it some sort of equality of arms when working with large manufacturers —to which, for reasons of sovereignty, we have effectively ceded monopoly power. So far, I am happy with where we are. I accept that the divisions the noble Baroness set out in the letter were technical policy matters. We have checked through the letter and are happy with it.

Unfortunately, in a sense, the Joint Committee on Statutory Instruments came through with its report a little late. I am not criticising that committee. The accident of timing, together with the demands of my wife, meant that my attention rested on the report only on Monday morning. I thank the Minister for taking it on board and responding to it.

I hope that I will be forgiven for my rather halting presentation. There are four relevant issues, the first of which relates to Regulation 5(3)(a)(i) and the Joint Committee’s concern about the reference to Regulation 12(1). As I understand it, the Government entirely take this point and will correct it in a subsequent regulation. The Committee will today not be well served by me going on about it any further.

The next point that the Joint Committee raised was essentially a drafting point. I think in a sense the committee was complaining that there was repetition. The problem with repetition if you are a lawyer is that you create synonyms, and synonyms are bad news because it is a feast for lawyers to work out which interpretation to take and gain the edge. The problem arises because of the shape of Regulation 10. In some ways, if the different methods of contract had been set out plainly with reference to pricing, it would be clearer. Despite the explanation given by the Minister, I still think that this particular regulation is—how shall I put it?—a little messy and inelegant. However, I accept that it probably has no substantial impact.

--- Later in debate ---

[Baroness Jolly]

I thank the noble Lord for his interesting and valuable comments and I shall address the points he raised as far as I can. We shall be in touch with him on any unaddressed points.

On his comment about the regulations being difficult for a lay audience to understand, and that the way they are laid out bears no relationship to the Act and that the cross-referencing of the two proved quite a challenge, we have done everything we can to make them as clear and comprehensible as possible. However, inevitably, they are highly technical and dry. They relate to a complex and specialist subject and it is necessary that they are accurate and precise. Everything in the regulations addresses specific issues in providing for the new framework for single source procurement.

When we had our meeting last week we discussed the intention that industry would probably not use the regulations but that the SSRO would produce specialist toolkits to guide industry through the morass of legislation and regulation. So, although those of us who enjoy reading these sorts of things might have had a problem, the department is doing all it can to smooth them out.

On the issue of training for industry, extensive briefing material has been provided. We have discussed this extensively in consultation with industry. We are providing workshops, briefing early adopters—including industry—and much of our guidance is on the internet, visible to industry and transparent.

“Mays” and “musts” is a good House of Lords regulation issue. I can confirm that the “may” in Section 18(2)(a) and (b) has not been used in the regulations. “May” does not mean “must”. I hope that the noble Lord is happy about that.

I thank the noble Lord for his comments and I hope that I have answered the main points raised during the debate. I further hope that Members of the Committee appreciate the Government’s commitment to improving this key component of our approach to procurement. This is a fundamental reform to a system which is well overdue for change. We continue to work with the SSRO and industry to ensure that implementation of the new approach is pursued as effectively and smoothly as possible.

Before I finish, I will not only repeat my thanks to the noble Lord, Lord Tunnicliffe, but thank the officials who not only had to teach me the intricacies of single source procurement—

[Lord Tunnicliffe]

Before the noble Baroness sits down, does she have any comments about the future of transparency? I think she does.

[Baroness Jolly]

My Lords, it is important that we should understand how any taxpayers’ money is being spent. How will Parliament know? The SSRO will publish an annual adherence report that will be laid before Parliament—helpfully, the officials, who I am praising to the hilt, have told me this—in the usual way. It may be that the noble Lord and I will have to google for press releases.

[Lord Tunnicliffe]

I know that it is extremely difficult to pick up on this point at the moment. I wonder whether, if the Minister can add a little more, she will write me a letter and place a copy in the Library.

[Baroness Jolly]

I will willingly do that and pop a copy into the Library. Finally, I commend the regulations to the Committee.