Contracting authorities must currently comply with the transparency requirements under the Public Contract Regulations 2015 (the PCR 2015) to ensure fairness to all bidding service providers.
To expand and improve transparency in the public procurement process the recent procurement bill has proposed the introduction of various regimes such as a more comprehensive public notice process and rigours information sharing methods and tools. In this article we examine the Cabinet Office Policy Paper "Transforming Public Procurement – our transparency ambition" and assess the direction of travel for the proposed transparency regime
Existing Transparency
- In addition to complying with the PCR 2015 and the relevant transparency guidelines, there are existing mechanisms that ensure a degree of transparency around public spending. For example:
The Find a Tender Service – a national notification system to publish public sector contracts that meet the legislative threshold; - Contracts Finder – a national notice for below-threshold opportunities and contracts specifically for SMEs;
- A requirement for central government departments to publish their tender pipeline; and
- Contracts register – local authorities are required to publish details for any contracts over £5,000 and transactions over £500 (including payments through contracts) on their own websites.
The Need For Change
The current transparency system enables effective government scrutiny on spending and has helped create more visibility of opportunities in the public sector but has had the following issues:
- fragmented information - only above-threshold tenders are published centrally, and information on the procurement lifecycle of each contract is located on different websites. This makes it difficult for a member of the public to reconcile and understand; and
- duplication and inconsistency of data – the publication of data on multiple portals sometimes means that some contracts will be published twice, and some will not be consistently published which can further create confusion.
Transparency Reforms
Among the many proposed changes to the existing transparency protocols, the government has proposed to embed three core changes:
- a thorough noticing regime – contracting authorities will be required to detail their planning and internal needs assessment process as well as their contract requirements more comprehensively;
- a supplier's registration service – for all information on suppliers to be uploaded onto one system; and
- a digital platform – to display all information with API access to data published to the Open Contracting Data Standard (OCDS), and potentially building other useful registers and commercial analysis tools.
Transparency Vision
The Cabinet Office's intention for a fully transparent procurement system is to provide members of the public with a better view on how the public sector operates, particularly how it spends money and with whom, with the goal of driving better value for money. The central public platform would enable the public to understand:
- current and future UK public sector procurement opportunities and public sector expenditure;
- status of existing contracts and their lifecycle, including whether final amounts paid differ from the originally intended contract value; and
- routes to market available for interested service providers; and
- which service providers excluded from public sector work due to corruption or poor performance.
As a result of the information sharing, the business landscape across the UK may improve through providing small businesses with the information they require to better prepare to engage and bid for public sector contract opportunities. It could also provide contracting authorities with opportunities to collaborate, monitor waste and promote efficiency.
The increase transparency across the public procurement process also comforts taxpayers, as they are able to see how their money is being spent by the public sector and how it contributes to the delivery of local services.
Potential Challenges
While the intentions set out in the Policy Paper are positive, we do foresee potential problems with their implementation. The proposed reforms will place a disproportionate burden on contracting authorities. The cost and time expended in preparing the notices and collating procurement data is likely to add significant administrative work and costs.
Ironically, providing too much information to the public may also have adverse effects and reduce overall visibility. For example, smaller organisations such as SMEs may not have sufficient resources to review the information and the overall volume of information uploaded may be more puzzling than useful.
There is also an imminent risk that the data being uploaded to the public sphere may be weaponised, by aggrieved bidders and politically motivated parties, to bring forward potentially trivial or frivolous claims.
To balance the aforementioned risks and challenges of executing the government's transparency plans, the government has planned to ensure that all transparency policies or systems developed are:
- user friendly - for those accessing and uploading the data and plug directly into systems integrated into existing software such as e-procurement;
- commercially useful – platforms will provide commercial analysis of data in exchange for uploaded data; and
- proportional – so that only key or necessary procurement information will be asked for.
What's Next?
Once the Bill has achieved Royal Assent – expected in the spring of 2023 – details of the transparency regime will follow as secondary legislation. Designing and developing the relevant transparency and data sharing systems will be a continuous process and will likely not be finished by the time the legislation comes into force. For this reason, the government has said it will provide at least six months’ notice ahead of the new transparency requirements having effect. This will give public authorities and service providers time to prepare for the changes to public procurement processes.
The government is keen on enhancing the overall transparency of the public procurement process. There are currently frameworks in place but have proven to be at times inefficient and ineffective. The transparency reforms described in the Policy Paper aim to implement systems that provide the public with more information and commercial insight. To achieve this, any new systems and policies must be user friendly, commercially useful, and proportional or risk being received by contracting authorities and service providers as nothing more than additional bureaucracy.
