It is a tradition in the Brabners Procurement Team to take a moment at this time of year to look back and reflect on the previous 12 months in the sphere of public procurement law.
We then make the very unwise decision to shoehorn some of the things that have been happening into a vaguely twelve days of procurement–mas theme in order to capitalise on the season. We are fully aware of what we are doing, and therefore without shame we present the twelve days of procurement-mas 2022:-
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The minimum financial thresholds went up and down faster than the UK changed prime ministers in 2022.
Procurement Policy Note (PPN) 10/21 came to effect on 1 January 2022. It raised the minimum financial thresholds above which public procurement law applies. It was quite dramatic given that this was the first time the Cabinet Office had issued such update rather than updates coming from the EU Commission and then being converted into to Sterling. While the thresholds went up, in order to comply with our WTO obligations they now have to include VAT. With VAT included, at the standard rate of VAT, in effect they went down instantly.
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The Procurement Bill makes glacial progress through Parliament, and starts speeding up as we write this article.
The Procurement Bill made the final Queen’s speech for the opening of Parliament and the government swiftly moved into action by taking the unusual step of launching the Bill in the House of Lords. The House of Lords swiftly ignored it as much as possible, with the third reading only taking place on 13 December 2022. There are signs it is speeding up, the first reading in the House of Common’s was 14 December and the second reading is now due for 9 January 2023. We have heard that the government is pushing to get Royal Assent in spring 2023, which is a change to the expected date of late 2023. With a six month implementation period, the Bill could be in effect either late in 2023 or early 2024. We look forward to updating you as it progresses through the House of Commons next year.
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Would-be challengers everywhere braced themselves for the impact of the Braceurself v NHS England case.
In September 2022, the High Court handed down a judgment that left the procurement world scratching its head ever so slightly. The Court had found earlier in the year that NHS England had been in breach of the Public Contracts Regulations 2015 when it made an error in its evaluation, which meant Braceurself lost the chance to undertake the contract. Despite having successfully proved such breach, Braceurself was left empty handed when the Court applied the Francovich Conditions and decided the breach was not sufficiently serious to warrant the payment of damages. If you want to see our article at the time on this judgement please see here.
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The procurement world braced itself (same joke again? Sorry about this – ed.) as Braceurself obtained permission to appeal the earlier decision.
On 7 December 2022, the High Court provided permission for the damages judgement to be appealed in the Court of Appeal. We are sure this will make interesting reading in 2023.
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The CJEU issues a persuasive judgement on abnormally low tenders.
Whilst post-Brexit the English courts are no longer bound by decisions of the Court of Justice of the EU (CJEU), we still keep a watch on such decisions and take them into consideration, especially where the decisions are at odds with English law findings. In one such judgment, the CJEU considered contracting authorities to be under an obligation to investigate tenders that appear abnormally low in all circumstances, rather than just when they are considering rejecting the tender on that basis. This is much broader than the approach taken in English cases such as SRCL Limited v NHS England and Bechtel Limited v Highspeed 2 (HS2) Limited and is one to watch. Please see our full article on this here.
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The case of Consultant Connect at last connected us with guidance on what a civil financial penalty that would be and a declaration of ineffectiveness situation.
The case of Consultant Connect Limited v (1) NHS Bath and North East Somerset, Swindon and Wiltshire Integrated Care Board and (2) NHS Gloucestershire Integrated Care Board and (3) NHS Bristol, North Somerset and South Gloucestershire Integrated Care Board was a case where there was a public interest in not making a declaration of ineffectiveness, even though grounds were there for doing so. The court ordered a contract shortening remedy as an alternative. This was noteworthy in itself, however, for a long time it has been known that declaration of ineffectiveness style remedies came with a requirement to issue a civil financial penalty (i.e. a fine). The Consultant Connect case was the first time where we were provided with guidance on the size of these penalties. See our original article here.
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Connected to the above (ok, I give up – ed.), Consultant Connect provided useful guidance on the operation of frameworks.
The case itself concerned whether a procurement process forming a mini competition under a framework was compliant. In the case, a sham process was followed, which then fed into a mini competition where the favoured supplier was the only one invited to tender. This case clarified that once frameworks are established it is not a free for all and contracting authorities cannot manipulate the framework to influence the outcome of the process.
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On a more sombre note, the conflict in Ukraine even touched the dusty world of public procurement law.
The first of only three PPNs issued in 2022 focused on implications of the sanctions against Russia and Belarus put in place by the UK government early on in the year. It required all in scope organisations to review their contract portfolio to identify any contracts where their prime contractor was a supplier from Russia or Belarus and to consider terminating in a legally compliant manner where possible. Naturally each contract had to be considered on the basis of its own specific circumstances, taking into account the public interest, legal restrictions, budgets, etc. (see our original article here). The Local Government (Exclusion of Non-Commercial Considerations) (England) Order 2022 came into force on 1 July 2022 to enable best value authorities and parish councils in England to terminate (if they wish to) any public contracts where the supplier’s country or territory of origin was Russia or Belarus.
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The Good Law Project inadvertently set the stage for Matt Hancock to appear on “I’m A Celebrity” (allegedly).
The Good Law Project and EveryDoctor together brought an action against the government in the case of R (Good Law Project and EveryDoctor) v Secretary of State for Health and Social Care regarding the use of the High Priority Lane for the award of personal protective equipment (PPE) supply contracts to three particular companies during March 2020. A judgment was handed down right at the start of the year. The High Court dismissed all but one of the claims. The only claim that was successful was that the high priority lane was in breach of the obligation for equal treatment under the regulations. While this is a fundamental part of procurement law, the claimants had a hollow victory. The Court decided against any form of declaratory relief as they noted even the high priority lane had a mostly compliant process in checking potential suppliers and that the providers all had genuine merits including the ability to provide high volumes of PPE at a time when they were in urgent demand. The Court said it is likely that the outcome would not have been substantially different had the breach not occurred. This received significant media attention from all angles but was also notable for the detailed consideration of the application of the requirements for equal treatment and transparency even when using the emergency award powers available under the regulations.
Our article, which contains a link to the full judgement, can be found here here.
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The Cabinet Office played around with the playbook.
The Cabinet Office updated the Consultancy Playbook and issued an accompanying guidance note. The guidance note prioritised knowledge generation and knowledge and skills transfer. This was set out in the second of only three PPNs issues this year, being PPN 02/22. For completeness, the third PPN, PPN 03/22 updated and replaced earlier PPN from 02/18 and provides updated guidance on data protection legislation following the UK’s exit from the EU.
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Santa delivers a late present in the form of the Subsidy Control Act.
One area of law particularly impacted by Brexit was in relation to subsidy control (formerly governed by the EU state aid regime). Since the UK left the EU any form of subsidy control has been governed by the UK's international treaty obligations, which has caused some scratching of heads over. However, the strange situation that has persisted since exit day in early 2021 is due to come to an end. For once the question of state aid/subsidy control causes excitement as the new Subsidy Control Act 2022 comes into effect on 4 January 2023.
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And finally … a shameless plug
The Crown Commercial Service awarded the RM6240 Public Sector Legal Services framework, which went live in October 2022. We are very excited to have won a place on Lot 1a (full service provision – England and Wales) and on Lot 2a (general service provision – England and Wales). To achieve a place on both lots at the first time of tendering capped off another exciting year for Brabners, and especially so for the Brabners procurement team who were heavily involved in the tender submission.
So that’s it another year down, another terrible Christmas procurement article for you to try and forget over the Christmas break. We wish everyone a very Merry Christmas and all the best for 2023. Whether you are a contracting authority or a private sector bidder, if you require any assistance with procurement in 2023 please do not hesitate to contact us.
